The Supreme Court found that the majority shareholder had breached an unwritten duty of loyalty and that liability could be established under Section 17-1 of the Norwegian Private Limited Companies Act (aksjeloven). The claim against the managing director did not succeed.
The parent company, together with other companies in the group, had made decisions which, taken together, resulted in the business of one of the subsidiaries being transferred to another company within the group. No consideration was paid for the transfer of the business. A majority of the Supreme Court (three judges) found indications that this conflicted with the principle in Section 3-9 of the Private Limited Companies Act. The parent company’s actions, viewed in light of the overall transactions within the group, meant that it had failed to comply with unwritten duties of loyalty towards the minority shareholder. The decision was reached by a 3–2 majority.
The ruling unanimously confirms that duties of loyalty exist between shareholders which go beyond the provisions of the Private Limited Companies Act. It also shows that the assessment of loyalty in relation to a company’s actions must be made in light of the actions of other companies within the group.
Source: Supreme Court
