Pender v Lushington 6 Ch D 70 is a leading case in UK company law, which confirms that a company member's right to vote may not be interfered with, because it is a right of property. Furthermore, any interference leads to a personal right of a member to sue in his own name to enforce his right. As Lord Jessel MR put it, a member,

Facts

The articles of association of the Direct United States Cable Company Ltd, registered under the Companies Act 1862

Companies Act 1862

The Companies Act 1862 was an Act of the Parliament of the United Kingdom regulating UK company law, whose descendant is the Companies Act 2006.-Provisions:...

 provided that no member would be allowed to vote on more than 100 shares at any meeting, and each block of ten shares was counted as one vote. It also provided that "the company shall not be affected with notice of any trust", a standard provision in company articles that is meant to allow companies to avoid complications or liability to the ultimate beneficiaries of shares.

Mr John Pender

John Pender

Sir John Pender , British Submarine communications cable pioneer, was born in the Vale of Leven, Scotland, and after attending school in Glasgow became a successful merchant in textile fabrics in that city and in Manchester; where he had a warehouse in Peter street near The Great Northern Warehouse...

 had bought 1000 shares. He was also chairman of Globe Telegraph and Trust Company Ltd, a holding company of a large group with competitors to the Direct United States Cable Company. Mr Pender had split his votes and registered the holders under the names of a number of nominees. After more than three months he then proposed the following motion at a general meeting.

“That it is expedient to put an end to the present antagonism of this company towards the Anglo-American Telegraph Company and its connections, and to work this company's cable in friendly alliance with their lines; and that a committee of shareholders be appointed to be named by the meeting to confer with the directors as to the best method of giving effect to this resolution, and to report to the shareholders thereon at such time as the meeting shall appoint.”

The opponents to the motion, including the company's directors and the chairman, Mr Lushington, proposed to amend the resolution so it had the opposite effect. Mr Pender and his nominees voted against any amendment and would have won if the votes of the nominees were counted. But Mr Lushington refused to have the nominees votes counted. He, along with other supporters of the motion sued for an injunction.

Judgment

Lord Jessel MR held that Pender could have an injunction for his vote to be recorded. Pender's vote was a property right which could not be interfered with, nor were the motives in this case such as to make the vote invalid. Furthermore, as a matter of litigation, Pender could sue in the name of the company, as well as in his own name. Interference with a personal right created both a derivative claim and a personal action.

See also

• UK company law
• UK public service law
• Ashby v White (1703) 92 ER 126
• MacDougall v Gardiner (1875) 1 Ch D 22, where the chairman, in breach of the company's articles refused to hold a poll, this was considered to be merely an internal irregularity, and so not able to be sued on by the member
• North-West Transportation Co Ltd v Beatty (1887) 12 App Cas 589, shareholders can vote so as to advance their own interests
• Allen v Gold Reefs of West Africa Ltd
  Allen v Gold Reefs of West Africa Ltd
  Allen v Gold Reefs of West Africa Ltd [1900] 1 Ch 656 is a UK company law case concerning alteration of a company's articles of association. It held that alterations could not be interfered with by the court unless a change was made that was not bona fide for the benefit of the company as a whole...
  
  [1900] 1 Ch 656, shareholders must, however, cast their votes bona fide for the benefit of the company as a whole
• Taylor v NUM (Derbyshire Area) [1985] BCLC 237, a member successfully sued the union in his personal capacity to restrain a strike which was in breach of the union rule book and beyond the union's capacity, but not to make the union officials restore funds already spent on the strike
• Andrews v Gas Meter Company
  Andrews v Gas Meter Company
  Andrews v Gas Meter Company LR 25 Ch D 320 is a UK company law case concerning the right of a company to amend its constitution to enable the issuing of preferential shares.-Facts:...
  
  [1897] 1 Ch 361
• Isle of Wight Railway Company v Tahourdin
  Isle of Wight Railway Company v Tahourdin
  Isle of Wight Railway Company v Tahourdin LR 25 Ch D 320 is a UK company law case on removing directors under the old Companies Clauses Act 1845. In the modern Companies Act 2006, section 168 allows shareholders to remove of directors by a majority vote on reasonable notice, regardless of what the...
  
  (1884) LR 25 Ch D 320

• Rigby v Connel (1880) 4 Ch D 482, judgment with a similar approach regarding trade unions