Litigation Solicitors in Colchester, Ipswich, London and Woodbridge
Director and Shareholder Disputes Lawyers
Although Attwells Solicitors are best known for our award-winning conveyancing services, we also provide a full range of corporate and commercial law solutions. When a business dispute arises, whether between directors, shareholders, or partners, our specialist Litigation Team is ready to protect your interests.
Director and Shareholder Disputes Solicitors
At Attwells, we are experienced in navigating the complex and often sensitive dynamics between directors and shareholders. Whether you’re a minority shareholder or a co-founder in deadlock, we can help.
Common Causes of Shareholder Disputes
Shareholder disputes are common and often arise due to:
- Lack of a shareholder agreement
- Deadlock between 50:50 shareholders
- Disagreements over business strategy
- Majority shareholders acting in self-interest
How to Resolve a Shareholder Dispute
We can help you find the best resolution to your dispute. This can involve:
- Share Buyback:The company purchases the departing shareholder’s shares directly. This approach can be tax-efficient and may benefit the remaining shareholders, but specific requirements must be met in order to proceed.
- Separating or Reorganisation: Tailored solutions to allow shareholders to part ways while preserving business value.
- Enhanced Rights for Minority Shareholders: Negotiated protections and restrictions to ensure fair treatment and prevent abuse of power.
- Court Action: As a last resort, we can pursue claims such as unfair prejudice petitions or winding-up orders.
Frequently Asked Questions about Shareholder & Director Disputes
1. What is the difference between a director dispute and a shareholder dispute?
A director dispute usually concerns disagreements over the management of a company, such as day-to-day decision-making or breaches of director duties. A shareholder dispute focuses on ownership rights, dividends, or the misuse of shareholder power. Often, the two overlap, especially where directors are also shareholders.
2. Do I need a shareholder agreement to avoid disputes?
A shareholder agreement is not legally required, but it is strongly recommended. It sets out how decisions are made, what happens if someone wants to leave, and how disputes will be resolved. Without one, disagreements can be much harder and more costly to resolve.
3. Can a minority shareholder take legal action against majority shareholders?
Yes. Minority shareholders can bring claims such as unfair prejudice petitions, where they allege that the company is being run in a way that unfairly harms their interests. They may also have rights under company law to challenge certain decisions or seek court intervention.
4. What is an unfair prejudice claim?
This is a claim brought under the Companies Act 2006 when majority shareholders or directors act in a way that unfairly disadvantages minority shareholders. Examples include exclusion from decision-making, diversion of business to another company, or withholding dividends.
5. How are shares valued in a shareholder dispute?
Shares can be valued in several ways, including market value, net asset value, or by an independent expert. The method often depends on what is set out in the company’s articles or shareholder agreement. If there is no agreement, disputes over valuation may need court determination.
6. How long does it take to resolve a shareholder dispute?
This varies depending on the complexity of the dispute and the willingness of parties to negotiate. Some disputes can be resolved in weeks through mediation, while others that go to court may take several months or even years.
7. Should I try mediation before going to court?
Yes. Mediation or negotiation is often quicker, cheaper, and less stressful than litigation. Courts also expect parties to explore alternative dispute resolution before pursuing legal action.
8. When should I contact a solicitor about a shareholder dispute?
You should seek advice as soon as a conflict arises. Early legal intervention can prevent matters from escalating and help secure a more favourable outcome.
Why Choose Attwells?
- Specialist solicitors with extensive experience in shareholder and director disputes.
- Clear, practical advice that balances legal rights with commercial realities.
- Cost-effective strategies aimed at resolution, not unnecessary conflict.
- Strong representation in negotiations, mediation, and litigation where required.
Get in Touch
If you are facing a shareholder or director dispute, early legal advice is essential. Contact our team today for a confidential discussion about your situation and how we can help, call our Head Office on 01473 229200.
