Shareholder Disputes

Shareholder disputes come about in different ways. They can arise in companies of all shapes and sizes. Examples of a shareholder dispute include a shareholder behaving irresponsibly or even fraudulently, sickness or disappointment that one shareholder is doing his or her share. Often it can be that the relationship has a run a natural course and one of the parties wants to pursue other activities. Sometimes the problem is that one shareholder is behaving oppressively by not acting in the best interests of other shareholders, which can take many forms such as:

• contrary to the interests of the members as a whole
• denying access to company documents
• using company money improperly;
• excluding shareholders / directors from meetings
• misusing company money

As all shareholder disputes are unique they usually require careful consideration to resolve. Seeking legal advice early will usually be the best way to contain and resolve the issues in dispute with the view to bringing about a sensible outcome as soon as practicable.

There are usually many options available when a dispute arises between shareholders and an experienced commercial litigation lawyer will be able to lay these out for you.

Obtain Legal Advice Early…

Obtaining legal advice to determine the nature of the dispute and how the law applies to the dispute is where shareholder litigation lawyer will assist. The law is complex in this area and getting sound legal advice early will arm you with the right information in order to make the best decisions on how to proceed. Litigation is certainly not always necessary but the possibility of it needs to be factored in because if the dispute cannot be sensibly resolved (and it often can with good legal representation), sometimes litigation is inevitable.

There are many reasons that give rise to a shareholder dispute but these are not always ultimately relevant to the how the dispute is resolved. If a negotiated settlement can be reached before the matter goes to court, this is often the best outcome for all concerned.

If a shareholder dispute does go to court the judge can make the following types of orders:

• winding up of the company
• orders that have the effect of modifying the company’s constitution
• appoint a receiver
• ordering that one shareholder purchase the shares of another
• that the company to engage in or discontinue legal proceedings
• modifying or repealing the constitution of the company
• grant an injunction, having the effect of restraining a party from doing a certain thing;
• requiring a person to do a specified act.

We regularly provide legal advice to shareholders, in particular dealing with the resolution of disputes and where necessary, representing shareholders in litigation. We have acted for many SME’s and individuals in complex disputes between shareholders and we can help you too.

We Can Help – Contact Us Today

To discuss your matter further please call us on 1300 907 335 or alternatively fill out the contact form on this page and we will respond to your enquiry promptly.