Issue link: https://maltatoday.uberflip.com/i/725667
46 maltatoday, SUNDAY, 11 SEPTEMBER 2016 Opinion I n a bid to protect a minority shareholder, the First Hall of the Civil Courts ordered that a new director be appointed on the board of directors. This was decided in Av. Jonathan Abela Fiorentino as special mandatory of Marsoft International AS -v- Vroon Containers BV and Balticmax Holding Company Limited on 2 September 2016 by Mr Justice Joseph Zammit McKeon. The plaintiff company, a Norwegian registered company, had filed an application in court asking it to regularise the affairs of the company by including amongst others an independent person on the board of directors of Balticmax Holding company Limited. Vroon Containers BV, a Dutch company, replied by denying that it acted unfairly towards Marsoft as prescribed by the Companies Act. However, on 5 July 2016, the parties minuted in the court proceedings that they were in agreement that the court should give an interim order to appoint a third directors to Balticmax in order for the company to continue to operate. The Court accepted to give this interim order, however, made it clear that this did not ref lect on the possible outcome of the merits of the case it had in hand. The Court explained that Article 402 of the Companies Act, is usually made use of by shareholders against directors of a company or a company with respect to unfair treatment or prejudicial towards them. In this article of the law, a shareholder would ask for protection of his/her rights on issues the shareholder has no control over. The mere fact that a shareholder is not represented on the board of directors is not an act of oppression or unjust or discriminatory. A judicial protection of a shareholder is intended for that shareholder to have more control and to avoid any unjust acts of other shareholders. The Court quoted from a 1999 judgement Monreal et -v- Delia noe held that Article 402 of the Companies Act is a safeguard and a protection of minority shareholders. The shareholder may make use of this article if they manage to prove to the court that due to the management of the company he is suffering a prejudice. This may also take the form of one action or omission. Mr Justice Zammit McKeon explained further that this article of the law is derived from the principles of equity and justice, that go beyond the statute of the company and even the law. Andrew Muscat in his book Principles of Maltese Company Law outlined the remedies available in Article 402: "Before examining the different types of order that can be made by the court, a preliminary question should be considered : whether a court may issue an interim order pending final judgement. The position in English law is that English courts do, where appropriate, have the power to issue interim orders – usually orders for payment on account or orders designed to preserve the status quo. The Maltese Companies Act is silent on the question of whether a court, seized of an issue under article 402, is entitled to issue an interim order. Nor does any jurisdiction result from any general provision in the Code of Organisation and Civil Procedure. It is significant that where the legislator wished to grant to a court the power to make interim orders, the legislator did so by express provision, as with the power of the court to issue a "provisional order" under article 37(5) of the Merchant Shipping Act (prohibiting dealings in a ship until the court definitely decides on the merits) and the power of the court to initially issue a warrant of prohibitory injunction for an "interim period " under article 873(7) of the Code of Organisation and Civil Procedure. In practice, situations may sometimes arise where the issue of an interim order would be necessary to protect the interests of the complainant or of the company. The introduction of an amendment to article 402 would allow the court to issue interim orders would be another helpful tool in the court`s arsenal against oppressive, unfairly prejudicial or unfairly discriminatory conduct ..." The Court then moved by giving the interim order and appointed Dr Richard Galea Debono as director of Balticmax and instructed him to care and diligence to protect the interests of the same company and to make sure that none of the shareholders suffer any oppression, prejudice or discrimination. Dr Malcolm Mifsud is partner Mifsud & Mifsud Advocates A request for the demolition of an existing old building followed by the construction of a wall 'to close up the site' was turned down by the Environment and Planning Commission, despite the application was recommended for approval by the Planning Directorate. In actual fact, the building in question corresponds to a rural structure surrounded by modern development located well outside the village core of Zabbar. To support its decision, the Commission held that 'the proposal runs counter to policy UCO13' citing that vernacular and architectural value should be conserved notwithstanding the building being located outside designated Urban Conservation Areas. Subsequently, applicant filed an appeal before the Environment and Planning Review Tribunal. In his detailed submissions, applicant observed that the Cultural Heritage Advisory Committee had stated that the present building does not merit scheduling and thus could be demolished. According to applicant (now, appellant), the Committee took account of the fact that the building serves as an 'obstacle to the existing thoroughfare'. On its part, the Planning Directorate also concluded that the building in question could be demolished since its architectural features were not 'unique' and the 'benefits of opening the street should outweigh impacts on cultural heritage.' Appellant went on to argue that 'the features found in the building are not of any particular value, so much so that the building was never scheduled'. Moreover, applicant contended that 'market forces have shown that although the building has been put up for sale for a long number of years, there was absolutely no interest (even in the 2005-2007 boom period) for the structure to be acquired to be reinstated in its current state and this is evidently due to the fact that prospective buyers in search for this type of property would normally f lock towards established UCA's and not to this setting.' Concluding, applicant highlighted that the present structure lies 'within a foreign context, projecting beyond the established street alignment'. In reply, the Authority stood firm with its decision to turn down applicant's application. The Authority reminded the Tribunal that the building is a traditional Maltese farmhouse built around a central courtyard and should therefore be 'restored and rehabilitated'. In addition, it was observed that the building is synonymous with vernacular structures dating to the Early Modern Period. Finally, reference was made to Structure Plan Policy UCO 13 which states that "wherever possible, by control or positive intervention, buildings of architectural, historical, and townscape importance, gardens, and other areas of architectural or historical interest will be conserved." In its assessment, the Tribunal acknowledged that the building in question was of the 'traditional type'. Nonetheless, the Tribunal held that there was little scope to conserve an old building within a 'foreign context' characterized by modern construction. Moreover, parts of the building 'protruded' beyond the established street alignment, resulting in a traffic hazard close to a busy junction. Against this background, the Tribunal ordered the Planning Authority to issue the permit. robert@rmperiti.com Dr Robert Musumeci is a warranted perit and holds a Law Degree. Old building 'out of context' Malcolm Mifsud mmifsud@mifsudadvocates.com.mt mmifsud@mifsudadvocates.com.mt Robert Musumeci The Authority reminded the Tribunal that the building is a traditional Maltese farmhouse built around a central courtyard and should therefore be 'restored and rehabilitated' Court protects shareholder by appointing a director on company board