A Business Person's Perspective on Resolving Shareholder Disputes in Canada


When shareholders, officers and directors disagree about how a business should be run, its future could be at stake. For many shareholders in medium-sized and small private businesses, the their shares are their and most important asset. Identifying and preserving its value is critical. When shareholders disagree, they become, angry, bitter and often unreasonable. At times like these, the advice, strategy and advocacy of a seasoned litigation and professional is what you need.

Business corporations are supposed to be run democratically. This means that while the will of the majority usually governs its affairs, the majority shareholders cannot abuse their power by trampling on the rights of minority shareholders. All shareholders are entitled to have the business operated in accordance with their reasonable expectations. When one or more shareholders abuse the rights of other shareholders, officers or directors, there may be grounds for an oppression claim. Other issues such as breach of fiduciary duty, buy-sell agreements, arbitration, injunctions and derivative actions might also be relevant.

In this informative article, Igor Ellyn and Orie Niedzieviecki, senior partners of ELLYN LAW LLP Business Litigation & Arrbitration Lawyers, Toronto, Canada, discuss how navigate the difficult waters of a shareholders dispute. The steps are complicated and a misstep may affect the final result. This article first appeared in the online newsletter of the Better Business Bureau of Central and Mid-Western Ontario, Canada. The authors and the firm, a boutique law firm in Toronto, Ontario, Canada specializes in shareholder and partnership disputes and other business litigation and arbitration. Ellyn Law is a member of the International Network of Boutique Law Firms - www.inblf.com. For more information about the authors, please visit wwww.ellynlaw.com

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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