Shareholder Disputes: A Practical Guide for Business Owners, Directors and Family Businesses

When relationships between shareholders break down, the consequences can be severe. Businesses can become paralysed by deadlock, directors may be removed or excluded from management, and minority shareholders can find themselves locked into a company with no control and no clear exit.

This book provides a practical introduction to the legal and commercial options available when shareholder disputes arise. It explains how the courts approach unfair prejudice claims, buyouts and winding-up petitions, and highlights the risks and opportunities involved in pursuing or defending legal action. Written for business owners, directors and family businesses, it is designed to help you understand your position and take appropriate professional advice at the right time.

Disputes between shareholders can threaten not only relationships but the survival of the business itself. When trust breaks down between business partners, founders, directors or family members, companies can quickly become paralysed by deadlock, financial conflict and competing interests. Many shareholders suddenly find themselves excluded from management, denied access to financial information, or under pressure to sell their shares at an undervalue. Others are dealing with directors diverting business opportunities, paying themselves excessive remuneration or making decisions that damage the company. Shareholder Disputes provides a clear and practical introduction to the legal and commercial issues that arise when conflicts between shareholders escalate.

Written specifically for business owners, directors and family businesses, it explains in straightforward language how these disputes arise and what legal options may be available. The book explains:

• what amounts to unfair prejudice under the Companies Act 2006
• the most common grounds for shareholder disputes
• how courts approach exclusion from management and breakdown of trust
• the role of derivative claims where directors breach their duties
• when a company may be wound up on the just and equitable ground
• the remedies available, including buy-outs and share valuations
• the risks, costs and strategic considerations involved in legal action
• the role mediation can play in resolving shareholder conflicts

Using practical examples drawn from typical disputes in small and medium-sized companies, the book helps readers understand the issues that commonly arise and the potential consequences of taking, or defending, legal action. Whether you are a business owner facing a dispute with a co-founder, a director involved in a breakdown of trust between shareholders, or part of a family business experiencing internal conflict, this guide will help you understand the legal landscape before deciding what steps to take next.

“A clear, practical and highly readable guide to one of the most complex and emotionally charged areas of company law. Essential reading for anyone involved in a shareholder dispute.” Alex Kennedy - Solicitor Advocate

About the Author: Robin Somerville is a direct access barrister (in England and Wales), CEDR accredited mediator and CEDR panel member, workplace investigator and arbitrator, and specialises in shareholder, company, board, partnership and business disputes. Prior to qualifying as a lawyer and mediator, Robin set up, grew and sucessfully sold three modest start-up businesses. He was also involved in his family's third-generation business, and was an equity holding director of one of the UK’s leading online price comparison websites for over 13 years. Robin also sits as a judge and arbitrator and was previously an Ombudsman at the Financial Ombudsman Service.