Plain language law

New Zealand law explained for everyone

Companies Act 1993

Enforcement - Derivative actions

167: Powers of court where leave granted

You could also call this:

“Court's powers when allowing legal action about a company”

If a court allows you or another shareholder or director to start or join a legal case about a company, the court can make different decisions about how that case will be managed. These decisions can be made at any time during the case.

The court might let you or someone else be in charge of how the case is run. They can also give instructions on what should happen in the case.

If the court thinks it’s needed, they can tell the company or its directors to give information or help with the case.

Sometimes, if the case ends with someone having to pay money, the court can decide that this money should go to people who own or used to own shares in the company, instead of to the company itself.

The court can make other decisions too, not just the ones mentioned here, to make sure the case is handled fairly.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320827.

Topics:
Business > Industry rules
Business > Fair trading
Crime and justice > Courts and legal help
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166: Costs of derivative action to be met by company, or

“Company may have to pay costs for shareholder or director's legal action on its behalf”

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168: Compromise, settlement, or withdrawal of derivative action, or

“Getting court approval to end or change a legal case started by shareholders or directors”

Part 9 Enforcement
Derivative actions

167Powers of court where leave granted

  1. The court may, at any time, make any order it thinks fit in relation to proceedings brought by a shareholder or a director or in which a shareholder or director intervenes, as the case may be, with leave of the court under section 165, and without limiting the generality of this section may—

  2. make an order authorising the shareholder or any other person to control the conduct of the proceedings:
    1. give directions for the conduct of the proceedings:
      1. make an order requiring the company or the directors to provide information or assistance in relation to the proceedings:
        1. make an order directing that any amount ordered to be paid by a defendant in the proceedings must be paid, in whole or part, to former and present shareholders of the company or related company instead of to the company or the related company.