Hussain & Anor v Wycombe Islamic Mission and Mosque Trust Ltd & Anor

A company’s assets may be transferred only by a properly authorised act of the company. Informal factional groups and their leaders acquire no legal authority over a company merely through influence or community recognition. The Duomatic principle permits unanimous member assent to take effect despite defective formalities, but assent must be objectively established. A company constitution may be construed broadly and purposively where it was informally drafted. Where a company has no validly appointed management committee, the court may use Companies Act 2006, section 306, to direct an election or meeting in a practical form. A religious or community leader’s spiritual authority does not itself create a legally binding arbitration, agency or contractual obligation.

The claim concerned the constitutional management of three mosques owned by Wycombe Islamic Mission and Mosque Trust Limited. The parties represented rival Seva and Thara groups, which disagreed over election-based management and a proposed transfer of the mosques to a charitable trust.

The claimants sought declarations concerning the company’s members, directors and constitution, together with directions for appointing a management committee. The defendants argued that existing committees and agreements, including the involvement of Pir Alludin Siddiqui and a draft trust deed, bound the company and its members. The central issues were the validity of the 2001 constitution, the legal status of the rival groups and committees, and whether the company or its members were bound to implement the proposed trust arrangements.

1. The court held that the five original subscribers were the only members of the company before 2001. Under section 22 of the Companies Act 1985, a person other than a subscriber became a member only by agreeing to become a member and having his name entered in the register.

2. The 2001 constitution had not been adopted by a valid meeting or statutory written resolution. Nevertheless, the Duomatic principle applied. The five members had given objectively ascertainable, unqualified assent, including by conduct and acquiescence. The constitution therefore became binding on the company despite the defects in formal procedure.

3. The 2001 election validly appointed the management committee and made those who registered to vote members of the company. The later 2003 election also validly constituted a committee. The constitution was to be interpreted broadly and purposively. Membership was open to Muslim men and women aged at least 18 who were permanent residents in the High Wycombe area, regardless of school of thought. The Sunni restriction applied to eligibility for the management committee, not ordinary membership.

4. The Seva and Thara groups were loose and fluctuating associations, not bodies with a sufficiently certain constitution or contractual agency. Their leaders could influence followers but could not bind them, the company or the wider mosque community. The 22-member and 12-member committees created through the factional settlement were not validly appointed and had no authority to bind the company.

5. Pir Siddiqui had not been given legally binding arbitral authority. The relevant arrangements were objectively insufficient to establish an arbitration agreement or continuing authority to impose a solution. The draft trust deed prepared by Faizal Siddiqui, and the purported decision to adopt it, therefore did not bind the company or its members. Any transfer of the mosques would require proper corporate authorisation.

6. Because the company had no valid management committee, the court directed that steps be taken towards a fresh election. Section 306 of the Companies Act 2006 permitted the court to order a meeting to be called, held and conducted in a manner suited to the circumstances. The election could therefore be treated as the required meeting, with ancillary directions for registration, nominations, voting and election administration.

First-instance decision. No prior appellate decision is stated in the judgment.