Harry J says Stassen directors trying to control him

(December 07, Colombo, Sri Lanka Gurdian) Businessman Harry Jayawardene is accusing two directors in his companies of 'seeking the assistance of the Court to achieve their illegal objective of oppressing the majority shareholder.'

Mr. Jayawardene filed these objections in the Commercial High Court on Thursday in response to a case filed by Mr. R.K. Obeysekere and Mr. Zaki Alif in November 2008, challenging the authority of Mr. Jayawardene to appoint his wife as a director of Stassen Exports and Milford Exports. The AGM of Stassen and Milford, scheduled for November 10, was postponed after the cases were filed. The objections state that Mr. Jaywardene has 60% equity of voting share in the Company and this has been in existence from the date of incorporation.

Mr. Jayawardene says he has been the single largest shareholder from the inception of Milford from its inception and the majority shareholder for over 30 years, a clear indication that there was and/or there could not have ever been an understanding or an arrangement that he would be a minority on the Board of Diretors.

The objections state that by the purported interim order, the petitioners are wrongfully seeking to prevent Mr. Jayawardene from exercising a fundamental and/or basic statutory right to which a shareholder is entitled and that the petitioners are endeavouring to restrict Mr. Jaywardene to be a minority on the Board of Directors whilst admitting that he is the shareholder having the majority shares in Milford Exports.

This position is contrary to fundamental and basic norms of company law and good governance.
According to the objections, under the Companies Act No. 17 of 1982 as well as the new Companies Act No. 7 of 2007, the majority equity shareholders are entitled to elect and/or select the Board of Directors of a company. He says the petitioners application is based on mere assumptions and not on facts inasmuch as they are assuming that the person who is proposed to be appointed as director at the said AGM will, after her appointment, conduct the affairs of Milford Exports in a manner oppressive to the petitioners and the shareholders.- Sri Lanka Guardian