Knowledge

Introduction

The Court of Appeal of the Cayman Islands has clarified the extent of the rights of investors in Cayman exempted limited partnerships to information about the partnership, restricting limited partners to relevant information within the context of their request.

The Court of Appeal's judgment in Abraaj General Partner VIII Ltd, in its capacity as the General Partner of Neoma Private Equity Fund IV L.P. v Abraaj ABOF IV SPV Ltd [2025] CICA (Civ) 8 has clarified the scope of section 22 of the Exempted Limited Partnership Act (the "Act") – setting out that a limited partner's right to "true and full information" does not mean unrestricted access to all information in the possession of the general partner. This protects general partners from unreasonable or excessive disclosure demands.

The Court of Appeal also indicated that disputes of this type are not appropriate for disposal by summary judgment where the general partner has arguable defences which will have to be tested.

The case

The case concerns a dispute over the capital account balance of Neoma Private Equity Fund IV L.P. (the "Fund").

The Fund was originally established in 2008 with Abraaj General Partner VIII Limited as general partner and Abraaj Investment Manager Limited ("AIML") as manager. AIML and Abraaj Holdings Limited were placed into liquidation in 2018-2019, and Neoma Manager (Mauritius) Limited replaced AIML as general partner of the Fund under a new limited partnership agreement.

In short, a dispute arose between one of the limited partners and the general partner about whether the limited partner had committed the required sums for investment, and proceedings were issued in the Grand Court of the Cayman Islands (the "Grand Court"). As part of the dispute, the limited partner requested production of a series of documents held by the general partner, relying in part on section 22 of the Act, which states that: "Subject to any express or implied term of the partnership agreement, each limited partner may demand and shall receive from a general partner true and full information regarding the state of the business and financial condition of the exempted limited partnership."

The Grand Court summarily ordered the production of the documents in June 2023, with the Grand Court noting that: "the limited partners are entitled to the same information that is available to the GP concerning the business and financial affairs of the partnership in this regard so that they may be properly informed as to what has been done on their behalf." The general partner then appealed the judgment to the Court of Appeal, arguing that the Grand Court had erred in its interpretation of section 22 of the Act, and that its decision was inconsistent with the previous judgment Gulf Investment Corporation v The Port Fund (Unreported, 16 June 2020) and the English High Court decision in Inversiones Friera SL v Colyzeo Investors II LP [2012] 1 BCLC 469.

The key issues for the Court of Appeal were whether the general partner's statutory duty under section 22 of the Act had practical boundaries, and whether summary judgment was an appropriate means of disposal for a dispute over compliance with the statutory duty in a case where there were contested factual issues.

The decision

The Court of Appeal allowed the appeal – it found that the judge at first instance had adopted too broad an interpretation of section 22 of the Act, relying heavily on Inversiones.

The judgment offers helpful clarification in that while it recognised the right to "true and full information" in section 22 of the Act is vital, that right does not entitle a limited partner to every document in the general partner's possession. The Court of Appeal went on to describe the test as functional and fact-sensitive, observing that: "…the purpose of the entitlement is to enable the limited partners to have a comprehensive understanding of the business decisions being made on their behalf and the financial consequences of those decisions both to the limited partners and to the business itself. What is meant by ‘full information’ is to be determined in this light."

The Court of Appeal also found that summary judgment, where evidence is on affidavit only, for disputes of this type was an inappropriate means of disposal, as the appellants had arguable defences that required factual testing at trial before an order could be made.