One of the main cases is Irvine – Ors v Irvine – Anor. Here, a minority shareholder filed a complaint against the director of the majority shareholder for the acquisition of the minority stake. The minority shareholder held nearly 50% of the company`s shares. The minority shareholder stated that he was excluded from the management of the company`s business. It did not receive financial information and was not included in business decisions. The minority shareholder`s claim was based on the right in the Corporations Act to claim an abusive early conviction of a minority shareholder. Shareholders are asking the court for explanations and injunctions to protect their investments. We use the decisions made by the strategy managers for our customers. Below are some of the key decisions as a guide for shareholders and directors of companies, which must be considered in dealing with difficult situations. Our client planned to invest in a small construction company and become a minority shareholder with two other investors.
The company had a shareholder at that time and there was no shareholders` pact. Brian and Jamie had never prepared a shareholder pact, they didn`t think it was necessary, because they could never foresee a situation where they could not resolve disputes between themselves. The end result was that our client left the company as part of a transaction agreement with the company that reimbursed him for all the investments she invested in the company. We have advised our clients on how best to resolve shareholder disputes. We even informed our client that due to the tense situation, she could count on the resignation of a director of her partner. A letter of a few days, the resignation came; Our client was not at all surprised by the resignation, as she said that we had «prepared her well to expect it». Under a «day along» plan, a joint shareholder or majority shareholder cannot sell its shares to third parties. That is, unless the third-party buyer offers to buy the shares of other shareholders at the same price. Things were busy and they never came to see the lawyer on the shareholders` pact. Brian wanted to force Jamie`s widow to sell his shares, but we had to tell him that in the absence of a shareholder pact, there was no easy way for him to force Jamie`s widow to sell the shares, and that the only real option was to negotiate a deal. Indeed, the underlying problem is often not the issue of self-confrontation, but the lack of enterprise mechanisms to find an amicable solution.
Well-developed corporate constitutions should take into account all eventualities, and a thoughtful and comprehensive shareholder pact can help the parties get through their disputes by anchoring the agreed paths, even in the event of acute disagreements. In the absence of a shareholders` pact detailing how to resolve the dispute, it was up to Lucy and Sophie to resolve their differences.