Trustees held majority of preference shares in a company, and all of the ordinary shares. Proposed to convert preference shares into loan stock (leading to a reduction in capital). Was clear that when making proposition, they were acting entirely on basis of what was in interests of trust (as they were obliged to). Held:
· Clear that trustees had not even applied their mind to question of what was in interests of preference shareholders as a class
· Thus consent to variation given by preference shareholders invalid.