Unfair Prejudice Claims: No Limitation Period After Zedra

Introduction

In THG Plc v Zedra Trust Company (Jersey) Ltd [2026] UKSC 6 (“Zedra”), the Supreme Court has confirmed that no limitation period applies to unfair prejudice petitions brought under s.994 of the Companies Act 2006. The decision restores what had long been the orthodox understanding and is of immediate importance for corporate and commercial practitioners.

But Zedra may have a wider impact. The Supreme Court traversed centuries of legal history in addressing whether a claim under s.994 constitutes an “action upon a specialty” for the purposes of s.8 of the Limitation Act 1980, or (depending on the remedy sought) an “action to recover any sum recoverable by virtue of any enactment” under s.9. The judgment is therefore likely to be required reading well beyond company law, particularly where questions arise as to whether a statutory claim is time-barred.

Background

In 2019, Zedra, a minority shareholder in THG Plc, brought an unfair prejudice petition. In 2022, it sought permission to amend its petition to include allegations relating to a bonus share issue in 2016. THG opposed the amendment on the basis that the claim was time-barred.

At first instance, Fancourt J rejected that argument. He held that the Limitation Act does not impose any limitation period on petitions under s.994, consistent with over forty years of settled understanding.

The Court of Appeal

The Court of Appeal allowed THG’s appeal. Emphasising the strong public policy against stale claims, Lewison LJ held that, in principle, a petition under s. 994 could be subject to a limitation period.[1]

Central to that conclusion was the decision in Collin v Duke of Westminster [1985] QB 581 (“Collin”). Lewison LJ relied on Oliver LJ’s observation that “specialty” is not confined to contracts under seal but extends to obligations imposed by statute. He also drew on the broader formulation that the key question is whether the cause of action exists independently of the statute.

On that basis – what the Supreme Court later termed the “wider Collin view” – Lewison LJ concluded that, since a shareholder has no right to petition for unfair prejudice apart from s.994, such a claim could fall within s.8, attracting a 12-year limitation period.[2]

He further held that where the only relief sought is monetary, the claim falls within s.9, attracting a 6-year limitation period.[3] This led to a “look and see” approach, whereby the applicable limitation period depends on the nature of the remedy. As Zedra sought compensation, its claim was held to be time-barred.

Snowden LJ agreed, while noting that it is relatively uncommon for s.994 petitions to seek compensation rather than a share purchase order. He also stressed that courts should not be discouraged from dismissing claims based on historical conduct, even where brought within time.[4]

The Supreme Court

The Supreme Court (by a majority) overturned the Court of Appeal’s decision, holding that no limitation period applies to claims under s.994.

Lord Hodge and Lord Richards (with whom Lord Briggs and Lord Lloyd-Jones agreed) undertook a detailed review of the historical development of limitation statutes and the concept of an “action upon a specialty”. They concluded that, when applied to statutes, such actions were historically confined to claims for the payment of a debt.[5]

An action upon a specialty is therefore best understood as an action to enforce an obligation created by a deed or statute.[6] Since s.994 does not create any such obligation – but instead provides a discretionary remedy – it does not fall within s.8.

Turning to s.9, the majority rejected the argument that a claim for compensation under s. 994 is an “action to recover any sum recoverable by virtue of any enactment”. They emphasised that a petition under s. 994 is not a claim to enforce a statutory obligation to pay money, but rather a claim inviting the court to grant such relief as it thinks fit.[7]

Any monetary award is therefore not “recoverable by virtue” of the statute itself, but arises from the court’s exercise of its very wide discretion.[8] The majority also rejected the “look and see” approach, holding that it is both unprincipled and impractical to tie limitation to the remedy ultimately granted.[9]

The Dissent

Lord Burrows dissented. He placed weight on the policy underlying limitation statutes in preventing stale claims, and rejected the majority’s distinction between statutes that create obligations and those that do not. In his view, most causes of action can ultimately be analysed in terms of rights and obligations.[10]

He would have applied the “wider Collin view”, and endorsed the “look and see” approach as a familiar feature of limitation law.[11]

Practical Implications

The decision brings welcome clarity. A limitation defence cannot be used to defeat an unfair prejudice petition – restoring what had long been understood to be the position.

That said, the absence of a limitation period does not give petitioners a free pass. The court retains a broad equitable discretion, and delay may still be highly relevant in determining whether relief should be granted. Indeed, the absence of a statutory “longstop” may encourage courts to engage more robustly with issues of delay and fairness.

Beyond company law, the Supreme Court’s rejection of the “wider Collin view” is likely to have wider ramifications. Claims previously analysed on that basis may now be open to challenge. In particular, litigants considering reliance on s.9 will need to examine carefully whether the compensation claimed truly arises “by virtue” of the statute, or instead depends on the exercise of judicial discretion.

Looking ahead, the key question is likely to be whether a statutory provision creates a substantive legal obligation, as opposed to conferring a discretionary remedial jurisdiction. As Lord Burrows’ dissent makes clear, that distinction may not always be straightforward in practice.

The decision is likely to have significant implications for the strategic use and defence of unfair prejudice petitions, particularly in cases involving historic conduct or evolving shareholder disputes.

[1] THG Plc v Zedra Trust Company (Jersey) Ltd [2024] EWCA Civ 158 (“Zedra CofA”) at [67]
[2] Zedra CofA [72]
[3] Zedra CofA [129]
[4] Ibid [161]
[5] Zedra [110]
[6] Ibid [115 – 116]
[7] Ibid [137]
[8] Ibid [145]
[9] Ibid [152]
[10] Ibid [201]
[11] Ibid [225]