Transfer of shares did not trigger a pre-emption right to real property

The owners of two neighbouring properties had agreed a mutual right of pre-emption to each other's properties. Following redemption and new subscription of shares in the company that owned one of the properties, the original owner was left with a third of the shares. The owner of the other property, who believed that this triggered the pre-emption right, demanded to take over the property in question, see section 11 subsection 5 of the Redemption Rights Act. The Supreme Court stated that the pre-emption right can also be triggered by a transfer of shares, but the changes must then be so significant that they are in reality equivalent to a transfer of the property. As a rule, the condition will be met if 90 percent of the shares end up in other hands. In the present case, the changes in ownership were not sufficient to trigger the pre-emption right.

Read the whole judgment (Norwegian only)

Areas of law: Contract law, pre-emption right, section 11 subsection 5 of the Redemption Rights Act. 

Key paragraphs: 39–42

Justices: Falkanger, Bergsjø, Falch, Steinsvik, Sæther