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A number of legislative controls are available to shareholders wishing to exercise their
rights. If it appears that the affairs of the company are not being conducted properly,
shareholders have some options available to them and among which, the statutory remedy
for shareholder oppression. It protects minority shareholders against being deprived of
their fair share and greatly improves their ability to take action against the company
alleged to be in breach of good corporate practices. The Courts have adopted a liberal
approach in the interpretation of the oppression remedy following some leading common
law cases and it is now the broadest of all the remedies available to minority shareholders.
There could be many instances where conduct has been held to constitute oppression,
among them is the conduct of company meetings. Formal exercise of majority power may
in fact, be unfairly prejudicial to a minority shareholder, justifying Court intervention.
The statutory remedy against oppression, unfair discrimination and unfair prejudice is
contained in ss 174-176 of the Companies Act 1993. It provides that the company affairs
are being conducted "in a manner that is oppressive, unfairly discriminatory or unfairly
prejudicial to him or to her may apply to the court for relief. The leading authority in New
Zealand on the meaning of the words "oppressive, unfairly discriminatory or unfairly
prejudicial"“ is Thomas v H W Thomas Ltd (1984), where Richardson J held that the
expressions are not distinct alternatives but overlap, each helping to explain the other
(Richardson J, Thomas v H W Thomas Ltd). The Court considered that it was not
necessary for a petitioner to prove a lack of probity or want of good faith towards him or
her on the part of those in control of the company. The section is concerned with instances
or courses of conduct amounting to an unjust detriment to the interests of a member or
members of the company (Watson and Noonan, 2005, p.8). The conduct of a company may
be unfairly detrimental to a shareholder in the company even though it is not
discriminatory and affects all members alike. The fact that all members are treated
uniformly as members will not necessarily make conduct fair (Glazebrook, Hammond and
ORegan, 2004). Section 174 may provide remedy even if the conduct accords with
company constitution, as prejudice may still arise. Relief can be given even if the conduct
is legal, there is no lack of good faith or probity, and where no agreement between the
