Our lawyers have extensive experience in dealing with shareholder and partnership disputes of all kinds.
Shareholders and partnership disputes can arise for many different reasons, from something as simple as a breakdown in communication, to more serious conduct like director fraud or breaches of the Corporations Act.
The constitution of the company or shareholders or partnership agreement often provides for how shareholders and partners are required to conduct themselves. It might have provide for a compulsory dispute resolution process, where each of the shareholders or partners agrees to participate in a form of alternative dispute resolution, for example a mediation, prior to commencing court proceedings against a shareholder or partner.
If there is no shareholders agreement, then the disputing shareholders will often need to look at the Corporations Act 2000 (Cth) to determine what they might be able to do in order to either enforce their rights against the other shareholders, or otherwise seek orders seeking to resolve the dispute, including orders for compensation against a shareholder or director, or an order forcing one shareholder to buy another shareholder’s shares.
If there is no partnership agreement, and the disputing partners are unable to resolve their dispute, then a partner may be able to serve a notice on the other partners dissolving the partnership. Generally once a notice of dissolution of partnership is served, the partnership is required to realise the assets of the partnership, and pay out the creditors of the partnership, before the balance is distributed amongst the partnership.
If the partners in a partnership are not able to agree on the sale of partnership assets, it might be necessary for one of the partners to apply to the court for an order appointing a receiver to the partnership. If a receiver is appointed to a partnership, then the receiver will stand in the shoes of the partners for the purposes of calling up the assets of the partnership, distributing the proceeds of the sale of assets to creditors of the partnership, before finally distributing the balance of any funds held to the partners.