Disputes involving shareholders can paralyse a business. If they are not resolved swiftly and in the right way, they can even cause a company to fail. Our shareholder dispute solicitors in Bournemouth are here to guide you to the best outcome for you and your business.
The good news is that most shareholder disputes can be resolved amicably and with minimal disruption or cost, if the right approach is taken at an early stage. There are also steps that can be taken to minimise the risk of future disputes, including reviewing and updating your shareholders’ agreements.
At Preston Redman, we regularly support shareholders and businesses from Bournemouth, Poole, across Dorset and beyond. We have a strong track record of achieving favourable solutions to these complex matters, normally without the need for court action.
Our team will be happy to provide shareholder dispute legal advice over the phone, via email and through videoconferencing, as well as in person for your convenience.
How our shareholder dispute solicitors can help you
Our shareholder dispute solicitors in Bournemouth can aid with matters such as:
- Shareholders’ legal rights
- Interpreting shareholders’ agreements and articles of association
- Breaches of shareholders’ agreements
- Unfair prejudice petitions by minority shareholders
- Conflict between shareholders and company directors
Common questions about shareholder dispute resolution
What legal rights do shareholders have?
The exact rights that shareholders have will be determined by legislation, the terms of the company’s articles of association and, if there is one, the shareholders’ agreement. Understanding these rights is usually critical to resolving shareholder disputes, so we recommend getting expert advice early on, so you can be clear about your legal position.
In general, a company’s articles of association will normally govern shareholders’ voting rights as well as how company shares can be bought, sold and transferred. A shareholders’ agreement should cover how decisions will be made between shareholders, measures to protect any minority shareholders and a set procedure for resolving disputes between shareholders.
How do you resolve shareholder disputes?
Your options for dealing with a shareholder dispute will vary depending on the circumstances. Getting specialist shareholder advice can help you to find the best approach for your situation.
In many cases, the process for dealing with shareholder disputes will be set out in the shareholders’ agreement. This will normally dictate that shareholders should work together to come up with a viable solution which the shareholders would then vote on. While this might seem straightforward, it is still worth consulting with a legal expert to ensure you follow the process correctly and that all relevant issues are taken into consideration.
If shareholders cannot agree a resolution, then other options that may be available include commercial mediation and arbitration. These methods of alternative dispute resolution can be very effective and allow you to avoid a conflict escalating.
Shareholders can also potentially consider solutions such as buying out a shareholder or shareholders who are in conflict with the majority, varying the company’s articles of association or shareholders’ agreement to limit particular shareholders’ rights, splitting the business or selling the business.
In some cases, it may also be necessary to consider court proceedings to resolve a shareholder dispute, but this is generally a last resort as there are usually alternative options.
How long does a shareholder dispute take?
How long it takes to resolve a shareholder dispute will depend entirely on the situation but, if the shareholders can work together to agree a resolution amicably, this will normally take less time than if court proceedings are required.
One commonly used option for resolving shareholder disputes is commercial mediation. This involves the shareholders working with an independent mediator to negotiate how to resolve the dispute. Commercial mediation usually takes place in a single session lasting half a day to a day.
How do you remove a bad shareholder?
The process for removing a “bad” shareholder should ideally be set out in the company’s shareholders’ agreement. Normally, this would involve buying out the shareholder.
Another option is to take action to limit the problem of shareholder’s rights. This can potentially be achieved through varying the articles of association and/or shareholders’ agreement.
In the worst-case scenario, the other shareholders could decide to voluntarily liquidate the company, then transfer its assets to a new company they have set up without the shareholder they wish to remove. In order to do this, the shareholders wishing to liquidate the company would need to hold at least 75% of the company’s shares between them.
Why choose Preston Redman’s shareholder dispute solicitors?
Preston Redman is home to a strong litigation and dispute resolution team with many years of experience across a wide range of commercial conflicts, including shareholder disagreements.
We can offer tried-and-tested expertise to navigate even the most complex forms of shareholder conflict, with strong skills in alternative dispute resolution and court proceedings.
As part of our shareholder dispute resolution service, we will take the time to fully understand the details of your dispute, as well as the commercial and personal context surrounding the issue. We can then make sure the solutions we offer give you the best chance of resolving the immediate situation while protecting your personal and wider business interests.
Our shareholder dispute solicitors’ fees
Getting the right legal support at the right time is one of the most cost-effective decisions you can make when dealing with shareholder dispute cases.
We are completely transparent about our pricing, so will be happy to discuss our fees and any other potential costs involved at the outset. You can then make a pragmatic business decision about how to move forward.
Get in touch with our shareholder dispute solicitors in Bournemouth
To speak to one of our friendly, highly experienced dispute resolution experts, please contact Janine Bryant at our Bournemouth office on 01202 292 424 or fill in our online enquiry form for a quick response.