Pender v Lushington
A member's right to vote is a personal right, which he can enforce in his own name, and members may vote in their own interests.
Facts
The articles of the Direct United States Cable Company limited the number of votes that a member could cast. Mr Pender transferred some of his shares to nominees, so that more votes could be cast in his interest. At a general meeting, the chairman, Mr Lushington, refused to accept the nominees' votes, so a resolution that Mr Pender supported was defeated. Mr Pender sued for an injunction.
Legal principle
Jessel MR held that Mr Pender was entitled to have the votes counted. He said that a member's vote is a right of property, which he may exercise in his own interests, and that he may vote in the way that he thinks best for himself, without any duty to vote in the interests of the company. The refusal to count the votes infringed Mr Pender's personal rights as a member, which he was entitled to enforce in his own name, so the rule in Foss v Harbottle did not prevent his claim.
Related cases on the company's constitution and decision making
- Allen v Gold Reefs of West Africa Ltd [1900] 1 Ch 656
- Ashbury Railway Carriage and Iron Co Ltd v Riche (1875) LR 7 HL 653
- Attorney General of Belize v Belize Telecom Ltd [2009] UKPC 10, [2009] 1 WLR 1988
- Brown v British Abrasive Wheel Co Ltd [1919] 1 Ch 290
- Bushell v Faith [1970] AC 1099
- Cane v Jones [1980] 1 WLR 1451
- Re Duomatic Ltd [1969] 2 Ch 365
- Eley v Positive Government Security Life Assurance Co Ltd (1876) 1 Ex D 88
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