A WORD ON SHAREHOLDER DISPUTES
When there is an extensive dispute between the shareholders of a corporation, the very existence and vitality of the business become threatened. The shareholders may have differences regarding various decisions related to the affairs of the corporation which if left untreated may disrupt the operations of the company. Of course, the most ideal solution for the shareholders is to rely on preventative measures put in place at the time of structuring the corporation to avoid the need to hire lawyers or to engage the court system in resolving disputes. For example, the shareholders may have a detailed shareholder agreement drafted by a business lawyer that sets out specific procedures for resolving differences between shareholders such as mediation, the use of trusted impartial third parties, and arbitration. Preventive measures are of course not always available or possible.
OUR INTUITIVE APPROACH TO RESOLVING SHAREHOLDER DISPUTES
Our approach to resolving shareholder disputes is collaborative and involves alternative dispute resolution where we seek to negotiate a solution with opposing parties without initiating lengthy and expensive court proceedings. Our goal is to resolve disputes with as little interruption to the daily business activities of the corporation as possible. Our resolution process involves tactful negotiations, reasoning, and a commitment by both parties to resolving disputes outside of the court system. Our experience shows that resolving shareholder disputes in the court system is expensive, lengthy, and emotionally taxing for all parties involved. Of course, it may not always be possible to resolve disputes outside of the court system and failure to reach solutions using alternative dispute resolution methods employed by us may lead to litigation.
WHAT TO EXPECT WHEN WE REPRESENT YOU IN A SHAREHOLDER DISPUTE MATTER
During our initial consultation and prior to being retained by you, we assess your individual situation and see if alternative dispute resolution is the right approach for you. Once we have determined that our approach may be viable for your situation, we will then create a resolution plan in which we set out the various options available to you in potentially resolving the dispute with the other shareholder(s). Such a plan may include an offer to purchase the shares of the opposing party, offering your shares for sale to the opposing party, utilization of a “shotgun procedure”, the use of an impartial trusted third party for the purpose of resolving the disputes and referral of the matter to mediation or arbitration as agreed to by the parties. The plan will be detailed, and you will have the option to weigh in on the strategies recommended by our business law team. Throughout the procedure, we will provide ongoing legal advice and support so that you will never feel alone in dealing with an unreasonable or difficult shareholder whose behavior may be jeopardizing the existence of your business.
To find more information about shareholder disputes, we recommend you visit the Business Law Insights section of our website. If you are involved in a shareholder dispute, contact us today to book an initial consultation with our experienced business law team where we will happily answer any questions you may have.