The judge found that Mr Tan's actions were partially motivated by personal animosity towards Mr Isaacs, but the offer also made commercial sense, and the pledge to reduce the company's debt was genuine.
The judge ruled that Mr Tan's actions did not amount to "conduct of the company's affairs" which must be evidenced to make out a successful case in unfair prejudice.
He ruled that Mr Tan's actions amounted to conduct in his private capacity as a shareholder. Accordingly, his conduct did not fall within the ambit of s.994.
Ultimately, the court found that Mr Tan's actions had not been unlawful or unconscionable, as they were still ultimately in the best interests of the company.
The directors were found to have acted with independent judgment and had used their powers to allot shares for a proper purpose.
They were also found to have made the decision for sound commercial reasons, which had been properly considered.
Although one of the directors, Mr Tan's nominee had considered the improper purpose of diluting Mr Isaac's shares, which was unfair, it was not prejudicial as the proper commercial purpose of the decision would have resulted in the same outcome.