Introduction

[1] As a general rule, the Court will not interfere with the decision of directors of a company on the way they wish to conduct the business of the company. This is popularly known as the 'business judgment' rule. Thus, decisions made by directors proposing rights issue as a means to raise working capital for the company will fall within the business judgment rule.

[2] However, where the proposed rights issue is motivated not in the interest of the company but with the objective of diluting the shareholdings of the minority shareholder(s) or for other improper purpose, the Court will intervene. Such a dilution can be the basis for an oppression claim.

[3] This case involves an evaluation of the motivation behind 4 proposed rights issues and whether the said proposed rights issues were engineered for the purpose of diluting the shares of the Plaintiff or were in fact bona fide in the interest of the company or for a pr