Director and Shareholder Disputes

Key facts: Director and shareholder dispute solicitors

  • Internal director and shareholder disputes can present challenges to your business that are just as severe as external threats.
  • We handle these sensitive disputes between directors, between different classes of shareholder, and between directors and shareholders, for businesses of all sizes experiencing internal disagreement. Our clients range from small family-owned companies and start-ups to professional partnerships and medium-sized and larger companies.
  • It’s crucial to think strategically at all stages of a company’s development about ways to reduce the possibility of directors’ disputes and disputes between shareholders, and to plan how to minimise the fallout when disagreements do arise.
  • Carefully drafted documents such as shareholder agreements, directors service agreements and articles of association should all anticipate the possibility of a future dispute and set out ways to manage them in the best interests of the business.
  • If a dispute arises it’s important to get legal advice early. We always encourage mediation and other forms of alternative dispute resolution to reduce the commercial impact of a dispute and remove the risk of long-running and costly litigation.
  • The business disputes section of our Advice Centre contains a wide range of advice articles that you may find helpful.

What we do: solicitors for director and shareholder disputes

Directors, minority and majority shareholders and owners of different classes of shares often have diverse – sometimes competing – priorities. Shareholder activism for example can put pressure on the company board to change course in a way directors may not agree with.

We work with companies to proactively manage these different interests and avoid disputes arising. But we are equipped with the expertise and practical experience to handle all types of disputes among company members when they do occur.

In relation to boardroom disputes we act for individual directors in dispute with their board and for groups of directors challenging another director’s behaviour or approach. The following are some of the more common disputes we typically help with:

  • Breaches of fiduciary duties and/or allegations of failing to act in good faith – from a legal perspective, directors of UK companies must act in accordance with their statutory responsibilities and their fiduciary duties of honesty, good faith and loyalty to the company. A breach can lead to conflict and may result in misfeasance claims or commercial fraud claims.
  • Conflicts of interest – when one director has competing business interests.
  • Challenging board decisions – there could be a divergence of opinion among directors about the development of the company, about payment of dividends or over other boardroom decisions.
  • Earn-out disputes – after a business is sold, depending on how the business performs, a disagreement may arise involving the level of future compensation accruing to directors of the sold business.
  • Removal of a director following a dispute – here it is important to note that as well as responsibilities, directors are also legally protected through director service agreements, articles of association and general employment law.

Our shareholder disputes work includes:

  • Advising minority shareholders on their rights in relation to the company, including derivative actions.
  • Unfair prejudice petitions – representing both petitioners and respondents where there are allegations that actions by a majority are unfair to the minority. Prejudicial behaviour may consist of the board failing to keep shareholders informed of company business or attempts at varying shareholders’ rights.
  • Removal of a shareholder – removal of shareholders is complex. There is no statutory right to force a shareholder to sell shares so removal must be approached with caution.

We also handle partnership disputes, advising on enforceability of clauses in a partnership agreement, including removing a partner or dissolving the partnership.

Resolving disputes between directors and shareholders is all about balancing legal protections with the responsibilities that come with being a company member.

We help ensure that our clients have in place the appropriate procedures to deal with disputes when they arise and to act quickly to minimise damage to the company or the interests of our client when there is a conflict. The specialist experience of our corporate team, including our corporate governance expertise and our significant presence across the country means we provide a genuinely comprehensive service to a wide range of companies and partnerships.

Who we help: corporate clients of all sizes

We act for individual shareholders and directors as well as boards and groups of shareholders. The companies we work with range from small, family-owned businesses and partnerships to start-ups, and established small and medium-sized companies with national and international reach.

In addition to advising businesses in established industries like manufacturing we work closely with younger companies in the creative industries as well as the rapidly developing energy and tech markets and growing sectors such as luxury retail.

Why use our directors and shareholder disputes solicitors?

Director and shareholder disputes can spiral out of control and damage a company if not handled correctly from the moment a dispute seems likely to arise. For us this means getting to grips with the nature of the disagreement quickly, applying our technical legal knowledge and responding with a practical strategy that protects the commercial interests of our clients.

Our business disputes team is made up of lawyers whose focus is entirely on delivering clear and realistic advice. All have been recruited from top 100 UK law firms in the UK or as in-house counsel to leading companies at home and abroad. Find out more about our dispute resolution solicitors:

Our three transparent pricing packages are designed to give you the widest possible access to high-quality legal advice, whatever the size and nature of your business:

City

Straightforward access to senior solicitors from £200 per hour.

An affordable solution for businesses needing one-off legal support. Receive 'City' partner-level expertise at a fraction of 'City' prices.

Enterprise

Have legal peace of mind for £189 per month with additional support from £99 per hour.

A monthly subscription legal support package specifically designed for start-ups and smaller businesses.

On-Demand

For businesses requiring 60+ hours of support a year, with prices equivalent to £99 per hour.

Fully account managed quarterly subscription service for businesses with more complex legal needs.

What next?

Please leave us your details and we’ll contact you to discuss your situation and legal requirements. There’s no charge for your initial consultation, and no obligation to instruct us. We aim to respond to all messages received within 24 hours.

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A national law firm

We mainly work remotely, so we can work with you wherever you are. But we can arrange face-to-face meeting at our offices or a location of your choosing.

Our commercial lawyers are based in or close to major cities across the UK, providing expert legal advice to clients both locally and nationally.

50-52 Newhall Street, Birmingham, B3 3RJ
Stirling House, Cambridge Innovation Park, Denny End Road, Waterbeach, Cambridge, CB25 9QE
10 Fitzroy Square, London, W1T 5HP
13th Floor, Piccadilly Plaza, Manchester, M1 4BT
Harwell Innovation Centre, 173 Curie Avenue, Harwell, Oxfordshire, OX11 0QG
2-5 Velocity Tower, 1 St Mary’s Square, Sheffield, S1 4LP

Our other locations

Immeuble Danica B, 21, avenue Georges Pompidou, Lyon Cedex 03, Lyon, 69486