28th October 2019
Wetherspoon's breach of Companies Act puts pressure on shareholder relationship - legal comment?
Hi,
JD Wetherspoon has been accused of breaching the Companies Act after failing to seek shareholder approval for spending on pro-Brexit messaging ahead of the 2016 referendum. The legislation says political spending must be approved in advance by shareholders, but Wetherspoon did not pass such a resolution before the referendum.
Companies are also meant to declare annual political spending above £2,000 in their annual report, which Wetherspoons allegedly failed to do. Can I get you comment from my lawyer client who can explain the ramifications of having the breached the Companies Act that Wetherspoons will face and what issues will arise from shareholders' perspectives? My client can explain the issues within a company that can arise in these instances and how they can be ironed out to avoid a full-blown shareholder dispute.