Shareholder Dispute Solicitors Birmingham
Shareholder and partnership disputes are a complex area of law and can arise within private companies for a variety of reasons. Shareholder disputes can become a serious issue as they can have a severe impact on the company and the associates involved.
Shareholder disputes solicitors know that the initial task at hand will be to identify the terms of the shareholders’ agreement. Often, the parties will have taken legal advice at the outset of their business relationship and had a shareholders’ agreement or joint venture agreement drawn up. It is not always this straightforward, however. Shareholder disputes often arise when the parties have commenced their venture together on a “handshake” basis.
Where friends or family are concerned, or in the case of a successful start-up business with humble beginnings, there may be no written agreement. This means that the parties’ rights and obligations are not conveniently set out in one place. This usually requires piecing together the terms of the agreement from past conversations and written communications. It can seem difficult, but it is an essential task that commercial litigation solicitors should look to perform with precision.
Types of Shareholder Disputes
At South Bank Legal, our shareholder dispute solicitors, Birmingham, have expertise in disputes involving issues such as:
- 50/50 shareholder deadlocks– often arising where no written shareholders’ agreement exists, the shareholders cannot agree on how to take the company forward, and no shareholder has the majority vote required to make key decisions. Communications between the parties have often broken down in these situations. Our shareholder disputes solicitors, Birmingham, have negotiated amicable resolutions to the most difficult of 50/50 deadlock cases.
- Unfair prejudice claims– notwithstanding the existence of a shareholders’ agreement, minority and majority shareholders can obtain statutory remedies under Part 30 of the Companies Act 2006. This is where the company’s affairs have been conducted in a manner that is unfairly prejudicial to the interests of shareholders. Unfair prejudice petitions are common. The Courts have the power to order that an affected shareholder be bought out by the company or the other shareholders.
- Disagreements as to funding– sometimes, a venture will require further capital contributions from the shareholders or individual business partners. Disputes can arise where there is no clear agreement as to how the venture will be funded beyond initial capital contributions. Funding stalemates can destroy the value of a venture if they are not resolved efficiently.
- Partnership disputes – partners are liable financially for a business partnership. Therefore, a third party can make a claim against the individual partners and the partnership itself. Disputes within the partnership can arise when there are disagreements regarding how the partnership is proportioned or when a partner wishes to leave the partnership. This could cause issues and complications for the remaining partners and the business.
- Breaches of fiduciary duties – according to UK law, directors of UK companies must act in accordance with their fiduciary duties, statutory responsibilities and loyalty to the company. If these points are not followed, a breach may lead to conflict. This could lead to commercial fraudfraud: in the context of commercial dispute resolution (as o... More claims or misfeasance claims if not resolved.
If you are currently dealing with a dispute that has been listed above, please get in touch with one of our shareholder dispute solicitors, Birmingham, for expert advice on your case.
Our approach to shareholder disputes
Expertly drafted shareholders’ agreements that are put in place can help to prevent partnership and directordirector: person appointed as an officer of a company, whose... More disputes from occurring by regulating the relationships between directors and shareholders. Shareholders’ agreements can also help to resolve disputes if they do arise as they can provide more clarity on the original partnership agreement agreed on between parties involved prior to the dispute.
LLP members agreements may also be used between the members of the limited liability partnershiplimited liability partnership: in business law, a legal enti... More. Limited liability partnershiplimited liability partnership: in business law, a legal enti... More agreements are legally binding contracts. They outline the responsibilities, rights, duties and liability of each member.
They also detail how the partnership will be managed and run. Limited liability member agreements are governed by the default provisions laid out in the Limited Liability Partnerships Act 2000.
Another way of resolving shareholder disputes includes arbitration, mediationmediation: in the context of litigation and dispute resoluti... More or an early neutral evaluation of the dispute. These are forms of Alternative Dispute Resolution (ADR) that can be used to resolve the dispute instead of using Court litigationlitigation: the bringing of a lawsuit or legal claim in cour... More proceedings. These methods are more cost and time-effective and can be more effective at taking both parties’ business interests into account.
If these methods prove to be unsuccessful, our partnership dispute solicitors, Birmingham, have the experience needed to guide you through the court processes and, when instructed, represent your case in the courtroom.
How can South Bank Legal assist?
Our partnership dispute solicitors, Birmingham, handle a range of commercial disputes. Please contact us if you are a majority or minority shareholder, partner or business owner in a venture and wish to understand your rights or potential claims. Get in touch via email at info@southbanklegal.com or telephone 0203 1266 584 for a confidential discussion with a shareholder dispute solicitor or our litigationlitigation: the bringing of a lawsuit or legal claim in cour... More team today.
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