The role of a company’s auditors and accountants in shareholders disputes

A company’s accountants and auditors often play a key role in the business of smaller companies, acting as general advisers to the directors.  This can lead to problems in the event of a shareholder dispute or boardoom battle.

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Derivative Actions - the Court loosens its apron strings

A derivative action is one where a shareholder takes legal action on behalf of the company.  This goes against the general rule that the affairs of the company are managed by the directors.  The reason for this remedy to is to provide a mechanism for redress where, for example, directors refuse to act (particularly where they are the wrongdoers).

The Companies Act 2006 introduced a new procedure for derivative actions which includes a two stage process for permission.  So far the courts appear to have been cautious about allowing shareholders to exercise the remedy but the recent case of Stainer -v- Lee and others may indicate a slightly more relaxed approach.

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A shareholder dispute need not result in a messy divorce

When you specialise in dealing with shareholders disputes you become more of a commercial divorce lawyer than a commercial litigator.  The passions that can be aroused in a dispute between the shareholders in a business are as intense as those which my colleagues in the family law sphere are used to dealing with.  How to avoid these passions killing the golden goose in boardroom disputes is a perennial problem.

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Handbook on International Commercial Arbitration

Shareholders disputes and boardroom disputes often have an international element.  Where arbitration is utilised to resolve such disputes there are many traps for the unwary.  In this respect I have no hesitation in recommending the recent Handbook on International Commercial Arbitration written by my fellow partner in Cripps Harries Hall LLP, Peter Ashford.

The book is a practical text aimed at those involved in international arbitration.  It is a handy addition to any commercial litigator’s library providing authoritative but easily digested guidance on all aspects of international commercial arbitration.

Shredding the rulebook

When RBS required massive handouts from the state Sir Fred Goodwin’s position on the board was untenable.  See previous post.

He departed with a big pay-off, which is the solution to many a boardroom dispute.  The size of the pay-off (which included a reported £8m addition to a pension pot which would pay him £640k a year from the age of 50) has caused public outrage and the government looks set to tear up the rulebook in a way which should worry everybody.

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Shareholder rights - a blunt instrument

Shareholders have statutory and other rights and in theory at least are the ultimate controllers of any company.  However two recent examples show how these rights are something of a blunt instrument when it comes to forcing the company in a particular direction.

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Not even the lawyers are making money

As once great retail companies like Woolworths collapse into insolvency and the car giants line up with their begging bowls for handouts from the US Treasury the sheer scale of the recession starts to become more clear.   Even the lawyers are not making the money they are used to.

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Boardroom brinkmanship at Barclays

The latest twist in the Barclays boardroom dispute over the bank’s emergency fundraising is a “back us or sack us” ultimatum from the Board.  This high stakes act calls the bluff of the angry shareholders. 

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The limits of shareholders agreements

Many a boardroom dispute has been nipped in the bud thanks to a well drafted shareholders agreement.  However, sometimes they can exacerbate the problem, as appears to be the case in the current easyJet boardroom dispute.

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Easy Disputes

An old fashioned boardroom dispute seems to be brewing up at EasyJet that is only tangentially related to the current economic circumstances.

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