Disputed family arrangement and company articles could not justify interim restraint on board action without prima facie enforceability.

A disputed family arrangement restricting management participation and voting rights was not shown to be prima facie enforceable, because no written instrument embodied it and the correspondence and conduct did not establish acceptance or implementation. The court also held that a board resolution passed in the ordinary course of corporate administration could not be restrained by temporary or mandatory injunction where it was supported by the company's articles and the statutory framework. In summary proceedings, civil court intervention was inappropriate, particularly when grievances concerning internal management could be pursued through oppression and mismanagement remedies. The requested ad interim injunctions were therefore refused.

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Issues: (i) Whether the alleged family arrangement restricting participation in the management and voting rights of the company was established sufficiently to justify ad interim relief; (ii) Whether the appellants were entitled to temporary or mandatory injunctions restraining implementation of the board resolution and regulating representation at the annual general meeting.

Issue (i): Whether the alleged family arrangement restricting participation in the management and voting rights of the company was established sufficiently to justify ad interim relief.

Analysis: The alleged arrangement was seriously disputed and there was no instrument embodying it. The surrounding correspondence and conduct did not establish, even prima facie, that the respondents had accepted or acted upon such a binding settlement so as to alter the company's internal governance. In the absence of a clear and enforceable family settlement, the Court declined to proceed on that assumption at the interlocutory stage.

Conclusion: The alleged family arrangement was not shown to be prima facie enforceable for purposes of interim relief.

Issue (ii): Whether the appellants were entitled to temporary or mandatory injunctions restraining implementation of the board resolution and regulating representation at the annual general meeting.

Analysis: The board resolution authorising representation at the meeting was passed in the ordinary course of corporate administration and was supported by the company's articles and the statutory framework governing board action, representation and validation of acts of directors. The Court held that a civil court, in summary proceedings, could not displace the contractual force of the articles or bypass the statutory remedies provided for complaints of oppression or mismanagement. As no independent basis for injunctive relief was established under the relevant procedural rules, the requested restraint could not be granted.

Conclusion: The appellants were not entitled to ad interim injunctions.

Final Conclusion: The appeals failed because the claimed family arrangement was not established at the interlocutory stage and the challenged corporate action was not shown to warrant civil court intervention by way of temporary injunction.

Ratio Decidendi: A disputed family arrangement cannot, without prima facie proof of enforceability, override the articles of association or justify interlocutory restraint on a company's internal management, especially where statutory remedies for oppression and mismanagement are available.

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