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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3840
Experience:  Solicitors 2 years plus PQE
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You I was ‘given' shares by a so called friend (who at the

Customer Question

YouI was ‘given' shares by a so called friend (who at the time was CEO and major shareholder in these companies )who I was in a different business with , I have the email to the company’s accountant stating what I’d been given and in what company’s I then got email asking for all personal details from accountant and the reply acknowledging receipt of my details and as far as I knew I was a shareholder I was in the circular emails for shareholders.I have emails saying the share certificates were on there way. So I pumped more money into the business we were in knowing I had these shares to fall back on. As we were working together i didn’t question the share certificates.Then the emails stopped and I was no longer a share holder in any of the company’s ! Ive questioned my ‘friend’ who now has back tracked saying he took them away from me as we weren’t getting on as such(real reason was share price had gone up ) Where do I stand legally as I can’t be taken off without my knowledge can i? or was i ever a shareholder ? Can i take it up with accountants ?Do I have a case ?Your help would be much appriciatedThank you
Submitted: 4 months ago.
Category: Law
Expert:  Alex J. replied 4 months ago.

Thank you for your question and welcome. My name is ***** ***** I will assist you. Were you ever listed as a shareholder on the Annual Return? What percentage of shares were you given? Did you ever sign a shareholders agreement?

Customer: replied 4 months ago.
Don’t know if if was ever listed , shares were in 6 companies ranging from 1% to 5% . Never signed a share holder agreement but neither has someone else who got some he got share certificate.Thank you
Expert:  Alex J. replied 4 months ago.

Thank you. How did you put your the money into the Companies ? Did you pay it into a company account? Do you know how this money was recorded in the annual accounts of the companies? Kind regards AJ

Customer: replied 4 months ago.
I was ‘given’ them as the he clearly wanted to get the cash for himself so didn’t have to put it in I have bank transactions into his personal account , I have the email exchange to the companies accountant stating that also asking for my details and i was in the shareholders circular emails after he received them. I just never had a share certificate
Expert:  Alex J. replied 4 months ago.

Thank you. The share certificates are absolute proof of ownership - without the certificates or a payment to the company -or a stock transfer form if the shares were bought from him and not issued by the company- the share circular is not sufficient evidence. You could push to sue for the shares but ultimately you are just going to be a minority shareholder in five companies with someone you don’t trust. You are better off pursuing this as a debt that the owes you for failure to deliver the shares agreed. Are the shares worth more money than you would have otherwise paid? If you treat this as a straight forward money claim it will be much easier to remedy - as you have the evidence of the money being paid to his account. I look forward to hearing from you. Kind regards AJ

Customer: replied 4 months ago.
There only one company that I want shares in that’s only 1% but that’s been valued at £200,000 so I want the shares I’ve been told I have. Surely the accountants email chain are legally binding ? In regards ***** ***** money I’ve transferred there is no reference to payments so how Can I prove what it was for ? As it’s a major project which will be going public soon there not going to want any bad press. I have an email offering the shares , one telling accountant what I have been given , one from account asking for details, one thanking me for details and emails for the shareholders with the rest cc’d in. I’m speaking to 2 other solicitors who have said I have a very strong case how do you think it’s not without the share certificates ?Thanks
Expert:  Alex J. replied 4 months ago.

Thank you. The share certificates would be a big help but that is not fatal to any claim. Claiming the shares is going to be more difficult to prove than a straight forward money claim. Having 1% of shares in a company where you don’t get on with the majority shareholder is a risk- he could dilute your shares etc. If that is the route you want to explore - a starting point is were the shares issued to you or sold to you? Were you required to pay Stamp Duty on them? Kind regards AJ

Customer: replied 4 months ago.
He’s told the accountant I was given them but the email to me has a price on the package so if it all comes out the board will see he’s selling shares for cash and not putting it in to the company. He’s had over half of his shares taken off him by the board as they want to sell them to raise money the chairman of the company apparently knows he has ‘given’ shares away to others so is expecting some contact . The major shareholder is now down to 24% and not well liked for his actions. A friends uncle Ian the barrister and legal adviser for the company and he’s said that the emails are legally binding and they would have to give them me but I want to be sure before I start the process also will wait till it all kicks off with the builds and becomes public.
Expert:  Alex J. replied 4 months ago.

Thank you. The emails are not "legally binding" but they can be used as evidence that a contract existed for the sale of the shares. Has this individual sold more shares than the number of shares in issue? Are there other shareholders in your position? Kind regards AJ

Customer: replied 4 months ago.
He hasn’t sold more than he has as far as I’m aware there is one other person who was told same as me that they had shares he has it in emails also he’s not going to do anything till the project started he’s not worried at all as he knows the company barrister personally and says it’s not a problem but again I need solid advice as don’t want to be told one thing and it’s hear say
Expert:  Alex J. replied 4 months ago.

Thank you. The advice is you can sue on one of two grounds:

(i) You paid money for shares - he is in breach of contract for not transferring those shares to you. You can sue him for all the losses you have suffered as a naturally occurring consequence;

(ii) You paid money for the shares - you sue him for specific performance of that contract and for the shares to be legally transferred into you name.

Those are the two options. Option (i) your evidence is proof that payment was made, Option (ii) your evidence is the emails which show a contract for the transfer of the beneficial interest of the shares was made to you.

Have you sent initial correspondence demand the share certificates? Kind regards AJ