Sometimes, no matter how well your business is going, disputes are inevitable. Stacks helps you and your business work through any disputes which may arise, in order to minimise any potential disruptions and costs to your business.
Shareholder disputes are disagreements between those who own shares in your company. Company disputes can be unpleasant and may impact on the overall productivity of your business. For this reason it is important that they are resolved swiftly.
If your business has a Shareholder Agreement drawn up, the procedure for resolving disputes will be clear and known to shareholders. In that case, the dispute may be managed early, hopefully without the need for court proceedings. For more information see Shareholder Agreements.
In the absence of a Shareholder Agreement, the company’s Constitution may be looked to, which sets out the rules about the internal management of the company. If your company does not have a Constitution, then the Corporations Act will provide information about avenues for managing the dispute.
As all company disputes are unique and will require different strategies to resolve, it can be beneficial to seek legal advice early. A Stacks Law Firm commercial lawyer can provide advice and assistance about managing your shareholder dispute so that you can get back to business quickly and with minimal financial disruption.
What are some common Shareholder disputes?
- Disagreements about business decisions
- One shareholder wanting to force another to sell them their shares
- Shareholders claiming they are doing more work than others
- Allegations of an unfair allocation of dividends to particular shareholders
- Minority shareholders (ie those who own fewer shares than some of the other shareholders) feeling that they are being unheard
- Breaches of duty by a Director
What is the process for resolving a Shareholder dispute?
- Alternative Dispute resolution (ADR) - going to Court should be a last resort. It is always more efficient, more cost effective and more amicable to resolve Shareholder disputes by way of ADR. There are different types of ADR and both parties to the dispute may choose the one that best suits them. These include Arbitration, Mediation, Facilitation, Conciliation and Negotiation. For more information see Alternative Dispute Resolution.
- Going to Court - this means that you will need to engage a commercial lawyer. The litigation proceedings under the Corporations Act will depend on the unique circumstances of your dispute.
Stacks practitioners are skilled in court litigation as well as a range of ADR processes to ensure that your business achieves the most efficient and cost effective resolution.
Need to speak to a lawyer about a shareholder dispute? Call us today