Key takeaways
Judgment brings clear guidance on historical shareholder allegations
An important judgment providing welcome clarification for shareholders, companies, and practitioners advising on historical allegations of unfair prejudice.
Petitioners can seek relief despite long past events
It confirms that unfair prejudice petitioners are not barred from seeking relief, including monetary compensation, simply because more than six years have passed since the underlying events.
Delays or acquiescence may still undermine a petition
Beware, unjustifiable delays or acquiescence of can still defeat a petition given the discretionary nature of the remedies sought.
The Supreme Court has delivered a significant judgment for shareholder dispute litigation, holding that unfair prejudice petitions under section 994 of the Companies Act 2006 ('CA 2006') are not subject to any statutory limitation period. The decision in THG Plc -v- Zedra Trust Company (Jersey) Ltd [2026] UKSC 6 marks a major clarification of the law in this area and overturns the Court of Appeal’s earlier position that such petitions fall within the Limitation Act 1980 ('LA 1980'), making delay in issuing a petition a matter of judicial discretion rather than a question of being time barred under statute.
Background
The dispute began in 2019 when Zedra Trust Company (Jersey) Ltd ('Zedra'), a minority shareholder holding approximately 13.2% of THG Plc ('THG'), issued an unfair prejudice petition under section 994 CA 2006. Zedra alleged that THG’s affairs had been conducted in a manner unfairly prejudicial to its interests as a shareholder.
In 2022, Zedra sought to amend its petition to include a new allegation: that it had been wrongly excluded from a bonus share issue in July 2016 (which was over six years earlier) causing it financial loss and entitling it to compensation from THG’s directors.
THG argued that this new allegation was time‑barred under section 9 LA 1980, which imposes a six‑year limitation period for actions seeking sums 'recoverable by virtue of any enactment.'
At first instance, the High Court dismissed this argument holding that unfair prejudice petitions are not subject to statutory limitation periods. The Court of Appeal disagreed, holding that section 994 petitions constitute 'actions upon a specialty' under section 8 of the LA 1980 and are therefore subject to a 12‑year limitation period. Critically however, it further held that section 9 overrides section 8 LA 1980 where a shorter statutory timeframe applies, meaning that in their judgment Zedra’s proposed amendment was out of time.
The Supreme Court’s decision
By a 4–1 majority the Supreme Court restored the High Court’s decision and confirmed that no statutory limitation period applies to section 994 petitions.
Section 994 petitions are not 'actions upon a specialty'
The Supreme Court held that section 994 does not create or enforce substantive statutory obligations. Instead, it provides a route to relief, a mechanism through which the court may intervene if unfair prejudice is proved. Because the provision does not impose an actionable duty the 12‑year limitation period under section 8 of the LA 1980 does not apply.
Section 9 does not apply to compensation claims within section 994 petitions
Section 9 of the LA 1980 applies to claims seeking to recover sums payable by virtue of a statutory right. However, monetary awards granted under section 996 of the CA 2006 are discretionary. They are not fixed statutory sums. A petition therefore does not seek to enforce a statutory entitlement to money meaning the six‑year period under section 9 does not apply.
No statutory limitation period applies
Because neither section 8 nor section 9 of the LA 1980 applies, unfair prejudice petitions under section 994 are not governed by any statutory limitation period. Petitioners may bring claims relating to conduct that occurred more than six (or even twelve) years earlier subject only to equitable considerations such as delay or acquiescence.
Rejection of the 'wider Collin view'
The Court expressly rejected the notion - sometimes referred to as the 'wider Collin view' - that any statutory cause of action automatically falls within section 8 of the LA 1980 as an 'action upon a specialty.' Earlier authorities dealing with other statutory schemes (including certain Insolvency Act cases) were criticised as wrongly decided to the extent they relied on this wider interpretation.
Sections 994–996 confer a remedial jurisdiction, not statutory obligations
The Supreme Court emphasised the remedial nature of the unfair prejudice regime. Sections 994–996 empower the court to grant whatever relief is appropriate rather than enforcing any mandatory statutory obligation. The fact that the Secretary of State may also bring a petition under section 995 reinforced this interpretation - it demonstrated that the provision is concerned with public and remedial functions, not statutory duties owed to specific parties.
Conclusion
The Supreme Court’s judgment provides welcome clarity for shareholders in an area long affected by uncertainty. Unfair prejudice petitions under section 994 CA 2006 are not constrained by statutory limitation periods, giving minority shareholders greater freedom to challenge conduct that may have occurred many years earlier. However, section 994 petitions can still be affected by bars caused by delay. Unjustifiable delays or acquiescence of the company’s affairs/actions can still defeat a petition given the discretionary nature of the remedies sought.
For further information on Unfair Prejudice Petitions, please contact Dan Taylor and Hassan Haider.
This article was co-authored by Trainee Solicitor, Hassan Haider.
