Foss v Harbottle (1843) 2 Hare 461, 67 ER 189 is a famous decision English decision on corporate law. Two minority shareholders initiated legal proceedings against, among others, the directors of the company. They claimed that the directors had missaplied the companies assets. The court dismissed their claim and held that when a company is wronged by its directors it is only the company that has standing to sue. In effect the court established two rules:

First, the "proper plaintiff rule".

The Court stated as such:

First, the proper plaintiff in an action in respect of a wrong alleged done to a company ... is prima facie the company itself. Secondly, where the alleged wrong is a transaction which might be made binding on the company ... on all its members by a simple majority of the members, no individual member of the company is allowed to maintain an action in respect of that matter for the simple reason that if a mere majority of the members of the company ... is in favour of what has been done then cadit quaestio – the matter admits of no further argument.

The other rule derived from this case was the "majority rule principle". It states that if the alleged wrong can be confirmed or ratified by a simple majority of members in a general meeting, then the court will not interfere.

1843 in law | English corporations case law