Reduction of company’s share capital had a discernible and bona fide purpose

Court of Appeal: (i) dismisses appeal and upholds the decision of the trial judge to refuse to recuse himself from hearing application by company confirming a resolution passed by its shareholders providing for a reduction in its company capital by way of the cancellation of 3,562,883,512 deferred shares, on the grounds that: (a) the trial judge applied the correct principles when determining whether to recuse himself for objective bias; and (b) the trial judge asked himself the correct question, namely whether a reasonable and fair-minded objective observer would have reasonably apprehended that there was a risk that he would not be fair or impartial in hearing the Confirmation Application; (ii) dismisses appeal and affirms the decision of the High Court Confirmation Order on the grounds that: (a) there was evidence that the reduction of the company's capital had a discernible and bona fide purpose; (b) the trial judge correctly had regard to the provisions of the Articles of Association in considering the nature and rights of the deferred shares and correctly identified those rights; (c) the evidence clearly established that the cancellation was not motivated by any bad faith, did not involve the majority seeking to coerce the minority in pursuit of its interests, was one “which persons acting honestly would regard as reasonable” and to which no reasonable objection had been identified by the appellant; and (d) there was no merit in the appellant's argument that the cancellation of the deferred shares on the terms proposed would involve a breach of EU law; (iii) dismisses appeal and cross-appeal and upholds decision of the High Court to make no Order as to costs in relation to the confirmation application on the grounds that: (a) whether to award the appellant the costs of the unsuccessful objection to the application was quintessentially a matter for the judge and there no basis for interfering with his judgment; and (b) the trial judge was best-positioned to assess the extent to which he derived assistance the appellant's submissions and the Court of Appeal had no basis for second-guessing this view; (iv) allows appeal and varies the costs order to the extent of setting aside the order for costs in respect of the recusal application and substitutes it for no order as to costs, on the grounds that: (a) the application was not frivolous nor was there evidence to indicate that the application was made other than bona fide; and (b) there were sufficient special circumstances on the facts to justify a departure of the normal rule that costs follow the event to the limited extent of making no order as to costs; and (v) declines to make a reference to the Court of Justice of the European Union on the grounds that: (a) the question the Court were asked to refer were clearly premised on factual assertions/assumptions that have no foundation in the evidence here and appear to have no actual connection with the issues that properly arise on the Confirmation Application; and (b) the questions did not raise any real issue of interpretation as opposed to application of the EU law provisions to which they referred.