Part 11Derivative claims and proceedings by members
Chapter 1Derivative claims in England and Wales or Northern Ireland
262Application for permission to continue claim as a derivative claim
1
This section applies where—
a
a company has brought a claim, and
b
the cause of action on which the claim is based could be pursued as a derivative claim under this Chapter.
2
A member of the company may apply to the court for permission (in Northern Ireland, leave) to continue the claim as a derivative claim on the ground that—
a
the manner in which the company commenced or continued the claim amounts to an abuse of the process of the court,
b
the company has failed to prosecute the claim diligently, and
c
it is appropriate for the member to continue the claim as a derivative claim.
3
If it appears to the court that the application and the evidence filed by the applicant in support of it do not disclose a prima facie case for giving permission (or leave), the court—
a
must dismiss the application, and
b
may make any consequential order it considers appropriate.
4
If the application is not dismissed under subsection (3), the court—
a
may give directions as to the evidence to be provided by the company, and
b
may adjourn the proceedings to enable the evidence to be obtained.
5
On hearing the application, the court may—
a
give permission (or leave) to continue the claim as a derivative claim on such terms as it thinks fit,
b
refuse permission (or leave) and dismiss the application, or
c
adjourn the proceedings on the application and give such directions as it thinks fit.