High-end London estate agent Winkworth has initiated High Court proceedings against its Chair, Simon Agace, for an alleged breach of contract after he and his wife attempted to oust the company’s Board, including his son.

However, both parties have recently agreed to a temporary ceasefire of at least a month. This agreement includes restrictions on Simon Agace from removing or appointing Directors without prior notice and not at all before 10 September.

According to the Board, Mr Agace allegedly breached “certain provisions” of his contract dating back to 5 November 2009. The Board also maintains that he allegedly breached duties related to his role as a director under the Companies Act, the law that regulates British companies and their Directors.

Simon Agace was Winkworth’s Chief Executive for 30 years until he stepped down in 2004 and passed the reins to his son, current Chief Executive Dominic Agace. The two men have been running the property firm together since it was floated on the London Stock Exchange in 2009.

However, at the company’s annual meeting in May, Simon Agace’s wife, Irene Ho Kim Lee, who is Dominic’s stepmother, used her 34 per cent voting power to attempt to oust all the Directors from the board other than her husband, including her stepson.

In return, the AIM-listed company launched legal proceedings against Simon Agace that restrict him from taking or encouraging steps to remove or appoint Company directors without first giving seven days’ written notice and, in any event, before 10 September 2026.

In the interim, the company “continues to operate as usual and the executive team remains focused on the delivery of the Company’s strategy.”

Commenting on the story, Roger Isaacs, Forensic Partner at Milsted Langdon, said that family disputes can have a deleterious effect on a company because the distract attention from the job of managing the business.

He added, “All too often shareholder disputes result in a pyrrhic victory whereby one group of shareholders succeed in getting control of a company only to find that it has collapsed and become worthless during the course of the legal wrangle about its ownership.

“In case of unfair prejudice proceedings, the court will therefore often require that a forensic accountant values the business not at the date of the trial but an a much earlier date.  The decision as to what date is chosen can often be of critical importance to the financial outcome and, unlike in divorce proceedings hindsight can never been used to inform the valuation.”

Source(s): Telegraph, City AM