Company shareholders moved to receive documents from the company in order to examine the possibility of filing a procedure against the other shareholders for usurping a business opportunity from the company and embezzling funds therefrom.
The Court partially accepted the motion, but determined that it is somewhat problematic due to delay and lack of good faith on the part of the shareholders. The element of good faith is an essential condition in regard with receiving documents documents or submitting a procedure on behalf of the company. In addition, a delay in submitting a motion may serve as an indicator to the level of good faith. Here, the motion was submitted four years after the events, even though the shareholders who submitted the motion were aware of the company's decisions which they tried to annul and even attended the relevant meetings. Further, they hid the fact that they had received some of the documents from the company. The failure to disclose all the facts and the delay in submitting the motion puts their good faith in question in a manner that justifies the reduction of the scope of the documents that shall be delivered to the shareholders.