A DISPUTE between two estranged brothers has led the Royal Court to wind up a 50-year-old company, which was set up to hold two St Helier properties.
In what the court agreed was ‘an unusual case’, Deputy Bailiff Robert MacRae said that the dispute between the company’s shareholders, Kenneth and Robert Gibbons – leading to a vacant property deteriorating in Halkett Street, unpaid tax arrears of £20,000 and unprepared annual accounts – ‘was unlikely to be in the best interests of either [brother]’.
Ordering that Monarch Investments Ltd should be wound up and its assets split between the two brothers as shareholders, Mr MacRae said: ‘The court is entitled, in our view, to take into account the age and likely stress on both men of these proceedings and their effect on the company and its underlying assets.’
Eighty-three-year-old Kenneth Gibbons had previously brought a representation to the Royal Court in 2016.
The court heard that relations between the brothers had deteriorated to the extent that they had only seen each other twice in more than two and a half years, and Robert – the younger brother by seven years – had been difficult to locate and had failed to respond to correspondence about the proceedings. As a consequence, Advocate Lynne Calder was appointed amicus curiae to assist the court.
She filed an affidavit describing her efforts to contact Robert Gibbons, culminating in a meeting at which he became ‘very animated’ and told her he wanted nothing to do with the case, that he was unfit to attend the trial and that the proceedings had made him very ill.
In court, Kenneth Gibbons gave evidence that the administration of the company had become impossible. When the two brothers attended a meeting at the Jersey Financial Services Commission in December 2021, Robert identified himself as the company’s only director and secretary, while a previous annual return still showed their late father, who died in 1972, as a director and beneficial owner.
The younger brother resisted a request from Kenneth to appoint him as second director.
Although Monarch Investment’s premises in Market Street were being let out and rent received, those in Halkett Place had been empty for more than a year because of lack of repairs.
Kenneth had been obliged to approach Revenue Jersey to persuade them to stay proceedings to recover a £20,000 tax liability, and he had also intervened to ensure that unpaid parish rates were finally settled.
As minority shareholder, he had been unable to change the board structure, leaving what his counsel Advocate Gregory Herold-Howes and Advocate Calder agreed was a company that was ‘paralysed’.
Giving judgment, the Deputy Bailiff – who was sitting with Jurats Andrew Cornish and Alison Opfermann – ordered that the company should be wound up and a liquidator appointed. He directed that Kenneth Gibbons’ costs should be paid from the company’s assets.
‘We are satisfied that these circumstances are sufficient to prompt a just and equitable winding up of the company… It has not been found that Robert lacks capacity and accordingly he remains the sole director and principal shareholder of a company which is diminishing in value as a consequence of his neglect. The breakdown of the relationship between brothers has been total… There are no practical alternatives to winding up on the just and equitable basis,’ Mr MacRae said.