Until three years ago, Slater was the sole shareholder anddirector of Lockley Quarries Ltd., a small corporation that owned aquarry and produced trimmed limestone blocks. Then an opportunityarose to purchase a second quarry at a very good price. Slater didnot have sufficient funds and persuaded Mason to come into businesswith him and to help finance the purchase of the new quarry. As aresult, Mason became a 40 percent shareholder and a director ofLockley Quarries. Slater and Mason got on well together and thebusiness prospered.
A few months ago, Slater was approached by an old friend,Chalker, who proposed
that they – Chalker and Slater – purchase and operate a gravelpit that had come
onto the market. Slater agreed, and a new corporation was formedto acquire the
gravel pit, with Chalker and Slater as equal shareholders anddirectors. Mason has learned of the dealings between Slater andChalker. He considers that he should have been given theopportunity to participate in the new gravel pit venture.
Do you agree? Does Mason have any remedy against Slater?
