0161 832 6131

Shareholder Law

Ralli has a team of expert solicitors who specialise in Shareholder Law. 

If you are planning to form a limited company or have a shareholder dispute, our specialist team of corporate and dispute resolution lawyers are here to help you.

We can assist in settling all forms of Limited Liability Companies and can advise you with regard to shareholder disputes. Also our colleagues in the Corporate and Dispute Resolution Departments at Ralli can deal with all aspects of Partnership Law.

The Ralli Shareholder Law team comprises approachable, straight talking Company Law experts living up to Ralli’s mission of Applying Law Exceptionally. If you are in the middle of a shareholder dispute or are concerned that one is looming, you need to speak to us.

SHAREHOLDER DISPUTES

The Memorandum of Articles of Association of a Company governs the relationship between the Shareholders and the Directors of a Limited Company. The starting point, if a dispute has arisen, is therefore to look at the provisions contained within this document.

There is, however, statutory protection provided to shareholders by virtue of S994 of the Companies Act 2006. If a shareholder can show that the affairs of the Company have been conducted in a manner which is “unfairly prejudicial” to his interests he can apply to Court for a remedy. The Court has very wide ranging powers in the event that such a claim is successfully pursued, to “make such order as it thinks fit”, including ordering the purchase of the shares of the claimant by another shareholder or the Company.

There is extensive case law which identifies what is regarded by the Court as “unfairly prejudicial” and each case will be considered on its own facts. Classic examples include where the controlling shareholders: 1)sell assets at an undervalue 2) divert business opportunities away from the company to other companies controlled by them 3) remove a director who is also a minority shareholder from office when he has a legitimate expectation to have a continued involvement in the running of the business and 4) the awarding by the minority shareholder to himself of excessive financial benefits.  Tell us the facts of your particular case and we will tell you if we think you have a good claim.

An important factor in the Court’s consideration is whether or not there is a “Quasi Partnership” in existence. Typically a limited company may have been formed by individuals formerly running a business in partnership. The Court is able to give additional protection to a shareholder in a quasi partnership so it is important to determine if your circumstances fall within the relevant requirements.

If you require help or further information, please contact David Potts

We are often asked about our successes - here are a few:-

The shares in a family run business set up by Mum and Dad had been transferred equally to four children, a brother and three sisters. The brother was managing director and ran the business on a day to day basis. He was acting as if the business just belonged to him alone. We were able to secure control of the business on behalf of the three sisters and to remove the brother as managing director and as a shareholder.

Our client was a minority shareholder in a business with no involvement in its day to day running. The directors were paying themselves substantial bonuses but no dividends for shareholders were being declared. We were able to secure an agreement to purchase our clients shareholding on the grounds of “unfairly prejudicial” conduct on the part of the directors.

A minority shareholder/director secretly established a competing business some years before resigning as a director. We pursued a claim for breach of fiduciary duty on behalf of the minority shareholder and, as part of the settlement terms, secured a transfer to our client, at no cost, of the shareholding owned by the minority shareholder.

To make an enquiry online regarding a Shareholder Dispute click here or call us on 0161 832 6131.

Ralli regularly gives advice to shareholders on the complex areas of majority and minority shareholder rights and obligations. Please call us on 0161 832 6131.