Clause 22

In this section and section 216B, “complainant” means —

any member of a company;

the Minister, in the case of a declared company under Part IX; or

any other person who, in the view of the Court, is a proper person to make an application under this section.(2) Subject to subsection (3), a complainant may apply to a Court for leave to bring an action in the name and on behalf of the company or intervene in an action to which the company is a party for the purpose of prosecuting, defending or discontinuing the action on behalf of the company.(3) No action may be brought and no intervention in an action may be made under subsection (2) unless the Court is satisfied that —

the complainant has given reasonable notice to the directors of the company of his intention to apply to the Court under subsection (2) if the directors of the company do not bring, diligently prosecute or defend or discontinue the action;

the complainant is acting in good faith; and

it appears to be prima facie in the interests of the company that the action be brought, prosecuted, defended or discontinued.(4) In connection with an action brought or intervened in under subsection (2), the Court may at any time make such interim order as it thinks fit including, without limiting, the generality of the foregoing —

an order authorising the complainant or any other person to control the conduct of the action;

an order giving directions for the conduct of the action; and

an order requiring the company to pay reasonable legal fees incurred by the complainant in connection with the action.(5) Where the action has been commenced or is to be brought in the subordinate courts, an application for leave under subsection (2) shall be made in a District Court.Evidence of shareholder’s approval not decisive — Court approval to discontinue action under section 216A216B.—

An application made or an action brought or intervened in under section 216A shall not be stayed or dismissed by reason only that it is shown that an alleged breach of a right or duty owed to the company has been or may be approved by the members of the company, but evidence of approval by the members may be taken into account by the Court in making an order under section 216A.(2) An application made or an action brought or intervened in under section 216A shall not be stayed, discontinued, settled or dismissed for want of prosecution without the approval of the Court given upon such terms as the Court thinks fit and, if the Court determines that the interests of any complainant may be substantially affected by such stay, discontinuance, settlement or dismissal, the Court may order any party to the application or action to give notice to the complainant.(3) A complainant is not required to give security for costs in any application made or action brought or intervened in under section 216A.(4) In an application made or an action brought or intervened in under section 216A, the Court may at any time order the company to pay to the complainant interim costs, including legal fees and disbursements, but the complainant is accountable for such interim costs upon final disposition of the application or action.”.