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1 Jus Corpus L.J. 315 (2020-2021)
Foss vs. Harbottle (1843)

handle is hein.journals/juscrp1 and id is 824 raw text is: VOL. 1 ISSUE 3 Jus Corpus Law Journal (JCLJ) ISSN:2582-7820 FOSS VS. HARBOTTLE (1843) Rohan Aniraj* Title of the case: Foss v. Harbottle Citation: [1843] 67 ER 189, (1843) 2 Hare 461 Court: Court of Chancery Quorum: Wigram VC, Jenkins LJ Parties to the dispute: Petitioner: Richard Foss and Edward Starkie Turton Defendants: Thomas Harbottle & Other's INTRODUCTION Foss vs. Harbottle case is a leading English precedent in company law. According to the rule laid down in this case, if any loss is suffered by the company by the negligent or fraudulent actions of its members or outsiders, then the action can be brought in respect of such losses, either by the company itself or by a way of derivative action. This rule led to for formation of the rule of majority and the minority shareholders rights. This rule is related to the management of the affairs of the company. When a decision must be taken a resolution is passed in the company by a simple majority or a three forth majority, the resolution becomes binding all the members of the company.1 The court in ordinary matters does not interfere in the internal management and matters of the company as it is decide by majority of members. The result of this makes the company the right plaintiff to institute a suit or any legal proceedings and does not let a single shareholder take any legal action against the wrongdoer. The rule in this case allows the company to correct the irregularities by its own internal procedure. However, a balance must be struck between the *BA LLB, THIRD YEAR, KIIT UNIVERSITY, BHUBANESWAR. 1 AVTAR SINGH, COMPANY LAW, 509 (Eastern Book Comxpany, 15th ed.). www.juscorpus.com3

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