THG v Zedra and the time problem in unfair prejudice petitions

At first glance, THG Plc v Zedra Trust Company (Jersey) Ltd looks like a technical limitations appeal. In reality, it is a major statement about the nature of the unfair prejudice jurisdiction itself. By a 4 – 1 majority, the Supreme Court held on 25 February 2026 that a petition under sections 994 and 996 of the Companies Act 2006 is not subject to the limitation periods in either section 8 or section 9 of the Limitation Act 1980. In doing so, the court refused to squeeze a flexible shareholder remedy into limitation language fashioned for very different kinds of claim.

The procedural route to that conclusion matters. Zedra, a minority shareholder in THG, had presented an unfair prejudice petition in 2019. In 2022 it sought permission to amend that petition to add a complaint arising out of a July 2016 bonus issue from which it said it had been wrongly excluded. The complaint was economically significant: Zedra alleged that, had it received its pro rata entitlement to the shares and converted and sold them on THG’s 2020 IPO, it would have realised a loss in the region of £1.8 million to £2 million. Fancourt J allowed the amendment; the Court of Appeal reversed him, holding that because Zedra was seeking compensation the new complaint was caught by section 9’s six-year period; the Supreme Court restored the first-instance position. Importantly, the Supreme Court did not decide whether Zedra had in fact suffered unfair prejudice. It decided only that the July 2016 complaint was not shut out by statutory limitation.

What makes the decision especially interesting is that the Supreme Court did not simply endorse orthodox practice because it had long been assumed to be correct. The justices recognised that for years judges, textbooks and practitioners had proceeded on the basis that there was no statutory limitation period for section 994 petitions. But the majority was careful to say that widespread professional belief is not the same thing as an authoritative judicial determination. The case therefore became an exercise in first-principles interpretation of the Limitation Act 1980, not an act of deference to received wisdom. That is a subtle but important point. The old understanding survived, but it survived because the Supreme Court thought it was the better reading of the statute, not because market practice had somehow hardened into law.

The majority’s treatment of section 8 is the first important step. The Court of Appeal had reasoned that an unfair prejudice petition was an “action upon a specialty” because it exists only by statute. The Supreme Court rejected that approach. Lord Hodge and Lord Richards held that, in this context, the essential feature of an action upon a specialty is that it enforces an obligation created by deed or statute. Sections 994 – 996 do not do that. They do not impose the substantive obligations whose breach gives rise to complaint; rather, they provide a remedial jurisdiction enabling the court to grant relief where the affairs of the company have been conducted in an unfairly prejudicial way. That distinction is fundamental. It means that section 994 is not merely another statutory cause of action to be filed alongside debt claims, contribution claims or statutory compensation claims. It is a supervisory remedial mechanism directed at unfairness in the management of corporate affairs.

The treatment of section 9 is, for most practitioners, the real centre of gravity in the case. Section 9 applies to “an action to recover any sum recoverable by virtue of any enactment”. The Court of Appeal had taken a practical “look and see” approach: if what the petitioner is really after is money, section 9 applies. The Supreme Court thought that approach was wrong in this statutory setting. A monetary order under section 996 is not a sum recoverable as of right by force of the statute. It arises only if, after finding unfair prejudice, the court decides in the exercise of its broad discretion that money is the appropriate form of relief. The same petition may justify a buy-out, regulation of future conduct, a mandatory order, a prohibition, authority to bring proceedings in the company’s name, or compensation. To make limitation turn on whichever remedy ends up being sought, or awarded, would in the majority’s view be unprincipled and close to absurd. The important point is not that money can never be ordered under section 996; it plainly can. It is that money is not what the statute makes recoverable as of right.

One of the most useful practitioner points in the judgment is what it did not decide in Zedra’s favour. Zedra had a fallback submission that, even if section 9 otherwise applied, section 36 of the 1980 Act disapplied it because the relief sought was “equitable relief”. The majority rejected that. Relief under section 996 is available because the statute confers it, not because the petitioner is enforcing some free-standing equitable claim. That part of the judgment may matter beyond unfair prejudice litigation. It shows the court was not simply reaching for whatever route would free section 994 from limitation; it was drawing careful conceptual lines.

Equally important, the court left one broader limitation question unresolved. The justices were not entirely aligned on whether section 8 extends to non-monetary statutory obligations more generally, and so they stopped short of a concluded ruling on the correctness of Collin v Duke of Westminster* outside the section 994 context. For company lawyers, the unfair prejudice answer is now clear. For limitation lawyers, some of the old archaeology remains unfinished.

So what, precisely, did the case establish? It established that there is no statutory limitation period under sections 8 or 9 of the Limitation Act 1980 for a section 994 petition, even where the petition includes, or is focused on, a claim for money. It also established something deeper: unfair prejudice is not to be analysed as though it were a fixed claim for a fixed remedy. The jurisdiction remains broad, discretionary and intensely sensitive to the overall fairness of the company’s affairs. In that sense, the decision keeps faith with the lineage of the remedy from the old oppression jurisdiction and with the emphasis in O’Neill v Phillips** on fairness within the agreed framework of the company’s constitutional and equitable understandings.

For solicitors, the practical consequences are immediate. Petitioners can no longer be met with a simple, bright-line argument that a section 994 complaint seeking money is automatically time-barred after six years. That is especially important where the complaint concerns a historic allotment, a dilution event, a removal of rights, or a pattern of conduct whose consequences only become commercially obvious later. But respondents are far from defenceless. The majority went out of its way to say that delay still matters. Unjustified delay, particularly delay that causes prejudice to respondents or third parties, remains relevant to the court’s discretion whether to grant relief at all and, if so, what relief to grant. The binary limitation defence may have gone, but arguments rooted in prejudice, acquiescence, evidential deterioration and the practical unfairness of reopening old corporate events are still very much alive. That shift from statutory bar to discretionary resistance is likely to become one of the defining tactical consequences of the case.

There is another strategic consequence too. The majority rejected the idea that section 994 should somehow inherit the limitation difficulties of other routes that might have been available on the facts. In other words, the mere fact that a company claim, a fiduciary claim, or some other cause of action might be time-barred does not justify importing that time bar into unfair prejudice. That makes section 994 a more potent strategic vehicle than some respondents would like, especially in founder-led or quasi-partnership disputes where what matters is not a single transaction viewed in isolation but the cumulative unfairness of the company’s treatment of the minority. As an inference from the judgment, claimant firms will now look even more carefully at section 994 where the facts can be characterised as unfair management of the company’s affairs rather than merely as a conventional private law wrong. Conversely, boards and majority shareholders should assume that the passing of six years does not, by itself, sterilise controversial historical conduct.

The dissent is worth taking seriously. Lord Burrows would have held that section 994 petitions are actions upon a specialty, with a default 12-year period under section 8 and a six-year period under section 9 where the petitioner is in substance seeking a monetary order. His reasoning is powerful because it speaks to values commercial lawyers instinctively recognise: certainty, finality and the undesirability of stale claims. He also thought the courts were capable of managing the apparent awkwardness of different periods applying to different forms of relief. That dissent matters because it shows the issue is not intellectually closed. The Supreme Court has settled the law, but it has not ended the policy debate. Both the majority and the dissent effectively signal that, if Parliament wants a bespoke discoverability-based regime for unfair prejudice petitions, it can legislate for one.

The best way to read THG v Zedra is therefore not as a technical victory for late amendments, though it is that. It is as a reminder of what unfair prejudice is for. The jurisdiction exists to give the court flexible tools to correct unfairness in the conduct of a company’s affairs. The Supreme Court has now said, clearly, that those tools are not to be blunted by forcing them through limitation categories designed for specialty actions and statutory money claims. For minority shareholders, that is a significant expansion of room to manoeuvre. For companies and controllers, it is a warning that time alone may not cure an unfair corporate history.

* Collin v Duke of Westminster [1985] 1 QB 581

** O’Neill v Phillips [1999] UKHL 24 (not mentioned in THG)