## Facts

- Michael G. Pagett, a minority shareholder of Westport Precision, Inc., made a written demand to inspect and copy corporate records under Conn. Gen. Stat. § 33-946(b)–(c).
- Pagett requested financial statements, tax returns, and accounting records to determine the value of his shares.
- Westport’s president and majority shareholder refused the request, citing ongoing litigation arising from Pagett’s termination.
- After a second written demand through counsel, Westport again refused and produced only limited corporate information and two balance sheets.
- Before trial, Westport sold all of its assets.
- Westport’s accountant testified that the balance sheets were insufficient to value the company and that valuation would require records such as cash receipts and disbursements, payroll records, purchase journals, and accounts payable/receivable—documents Pagett had requested.
- The trial court issued a writ of mandamus compelling production but denied Pagett attorney’s fees under Conn. Gen. Stat. § 33-948(c), finding no bad faith.

## Issues

1. Whether mandamus properly issued compelling inspection and copying under Conn. Gen. Stat. § 33-946(b)–(c), including whether Pagett (a) acted in good faith and for a proper purpose, (b) stated that purpose with reasonable particularity, and (c) sought records directly connected to that purpose.
2. Whether attorney’s fees were required under Conn. Gen. Stat. § 33-948(c) because Westport refused inspection without a good-faith reason.

## Decision

- The court affirmed the order granting mandamus compelling Westport to permit inspection and copying of the requested records.
- The court held Pagett satisfied the statutory prerequisites: valuing his shares was a proper purpose, his demand stated that purpose with reasonable particularity, and the requested records were directly connected to valuation.
- The court rejected Westport’s reliance on pending litigation as a basis to deny inspection where Pagett remained a shareholder seeking valuation information.
- The court reversed the denial of attorney’s fees and remanded with direction to award fees because Westport lacked a good-faith reason for refusing inspection.

## Legal Principles

- Under Conn. Gen. Stat. § 33-946(b)–(c), a shareholder may inspect and copy corporate records upon written demand made in good faith and for a proper purpose, stated with reasonable particularity, seeking records directly connected to that purpose.
- A shareholder’s desire to value his or her shares is a proper purpose for inspection, including in a closely held corporation.
- The existence of separate litigation between a shareholder and the corporation does not, by itself, defeat statutory inspection rights when the inspection purpose is proper and made in good faith.
- Records are “directly connected” to a stated valuation purpose when evidence shows they are necessary to conduct a meaningful valuation, not merely when the corporation offers limited summary documents.
- Under Conn. Gen. Stat. § 33-948(c), when a corporation refuses inspection without a good-faith reason, the court must award the shareholder reasonable costs and attorney’s fees.

## Conclusion

The appellate court enforced a minority shareholder’s statutory right to inspect corporate financial and accounting records needed to value his shares, and it required an award of attorney’s fees because the corporation’s refusal—based largely on related litigation and partial disclosures—was not supported by a good-faith reason.


Pagett v. Westport Precision, Inc., 82 Conn. App. 526, 845 A.2d 455 (Conn. App. Ct. 2004)