Ross v Telford [1998] 1 BCLC 82

Facts

• The case concerned a dispute within a company that prevented a general meeting from being held through the usual corporate procedures.
• A group of shareholders applied to the court for an order to convene a meeting under section 371 of the Companies Act 1985, which empowers the court to order meetings if it is “not possible” to hold one by ordinary means.
• The dispute centered around the legal meaning and application of the phrase “not possible” within section 371.

Issues

1. What constitutes “not possible” under section 371 of the Companies Act 1985—does it include merely challenging circumstances or only true legal/practical impossibility?
2. What evidentiary standard must applicants meet to secure a court-ordered meeting under section 371?
3. What factors should the court consider in deciding whether to grant a section 371 application?
4. How does the purpose of the proposed meeting and the interests of the company weigh in the court’s decision?

Decision

• The court held that “not possible” under section 371 means an inability to hold a meeting due to legal barriers, deadlock, or practical failure, not simply organizational difficulty.
• Applicants bear the burden to provide clear and specific evidence demonstrating that normal procedures for convening a meeting cannot function.
• The court established that intervention should be exceptional, with court-ordered meetings reserved as a last resort.
• The purpose of the meeting must relate to legitimate company matters and not serve individual shareholder interests.
• The court must consider if alternative solutions exist and whether the meeting is genuinely in the interests of the company as a whole.

Legal Principles

• A high standard of proof is required to show that convening a meeting by normal means is genuinely “not possible”; vague or general claims are insufficient.
• The court will only intervene when there are specific legal or procedural obstructions to holding a meeting.
• Court-ordered meetings must further the interests of the company, not the interests of select shareholders.
• Alternative dispute resolution methods should be explored before seeking a court order.
• The ruling reinforces lawful governance and procedural compliance in company management.

Conclusion

Ross v Telford [1998] 1 BCLC 82 defined “not possible” within Companies Act 1985 section 371, requiring applicants to present strong evidence of legal or practical barriers to standard meetings, and reaffirmed that court-ordered meetings are an exceptional remedy grounded in clear company interests and compliance with correct procedures.