C owned shares in two property-owning companies. These two companies had a property managing agent, the Thompsons. C believed two companies had suffered losses due to Thompsons committing various improprieties (e.g. charging excessive management charges to two companies). C therefore sued D, sole director of Thompsons, on grounds he had inadequately supervised his firm. Held:
· Case distinguished from Re Elgindata
· In Elgindata, management had simply been poor
· Whereas in present case:
Ø Were specific acts of mismanagement by Thompsons, which D failed to rectify
Ø Some acts of mismanagement were repeated over many years
· Thus on facts, acts of mismanagement were sufficiently serious to cause unfair prejudice to C.
Relevant here that D’s firm stood to gain from some the acts of mismanagement (e.g. the excessive charges).This possibly a key factor.