AG Belize v Belize Telecom [2009] UKPC 10

• Articles provided that certain special shares gave their holders a right to appoint two directors of the company.

• Claimant purchased some of these voting shares, but fell into financial trouble and later sold them.

• Issue was whether directors appointed by Claimant were required to vacate office one Claimant sold his shares.

Held

• Courts will imply terms into articles where this merely makes express what they would have reasonably been taken to mean against relevant background.

• Court only has power to ascertain the meaning of the articles as a whole, and NOT individual terms.

• Thus courts can imply terms in fact based upon meaning of articles as a whole.

• Therefore “relevant background” includes:

  1. Scheme of Articles themselves

  2. To a very limited extent, background facts that third parties involved with the company would reasonably have known

• On facts, anyone reading document as a whole would have reasonably understood that directors were required to vacate office.

  • Therefore terms could be implied to this effect.