Interpretation of contract: definition of subsidiary (Supreme Court)

In Farstad Supply AS v Enviroco Ltd, the Supreme Court unanimously dismissed Enviroco Ltd's appeal and held that E Ltd was not a subsidiary of A plc for the purposes of a contractual provision which incorporated the definition of subsidiary in section 736 of the Companies Act 1985 (re-enacted in section 1159 of the Companies Act 2006) where A plc had granted security over its shares in E Ltd to a bank and the shares had been registered in the name of the bank's nominee.

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