Liability for a majority shareholder

Supreme Court judgment 13 October 2020, HR-2020-1947-A, (case no. 20-005988SIV-HRET), civil case, appeal against judgment. 

Satoe Invest AS (Counsel Yngve Andersen) v. Petter Arne Alvik, Skoledrift AS (Counsel Christian Fredrik Galtung)

Justices: Indreberg, Webster, Noer, Falch, Høgetveit Berg

The business activities in a group company, which also had a minority shareholder, were transferred free of charge to another group company. When assessing whether the transfer formed a basis for the minority shareholder's claim for damages towards the parent company, the Supreme Court unanimously found that the Companies Act must be supplemented by a non-statutory duty of loyalty with the general clause in section 5-21 and other provisions on minority protection as a natural starting point. In the individual assessment, the Supreme Court's majority of three justices found that the transfer, in the light of the other group companies' actions, implied that the parent company had breached its duty of loyalty. There was thus a basis for liability under section 17-1 of the Companies Act. The minority shareholder's claim against the general manager could not prevail. A minority of two justices found that there was no basis for liability. The Court of Appeal's judgment in favour of the company was set aside. Dissenting votes 3-2.

Read the whole judgment (Norwegian only)

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