Minority Shareholder Oppression

If you can relate to these cases below, Contact Us Immediately: • Shifting of a corporate opportunity by the majority shareholders to themselves (Cook v Deeks). • Directors issuing shares for improper purposes (Wallington v Kokotovich Constructions Pty Ltd). • Unfair exclusion of a director for an improper purpose (John J Starr (Real Estate) Pty Ltd v Robert R Andrew (Australasia) Pty Ltd). • Low dividend payments due to excessive remigration (Sanford v Sanford Courier Service Pty Ltd). • Failure to give proper notice of meeting (Foody v Horewood); Shum Yip Properties Development Ltd v Chatsword Investment & Development Co Pty Ltd (2002). • Wrongful exclusion from participation in management High Court of Australia case Campbell v Backoffice Investments Pty Ltd [2009] HCA 25); Fexuto Pty Ltd v Bosjnak Holdings Pty Ltd 2001. • Controlling members gain an unfair advantage by oppressive (Re Overton Holdings Pty Ltd (1984)). • Making uncommercial loans to a company without consent from the minority shareholders (Re George Rayment; Slater v Gilberstson (2000). • Breakdown in mutual trust and confidence (Kotokovich Constructions Pty Ltd v Wallington (1995)) – dilution of shares rendering the shares worthless.

• Deadlock with directors without oppression (irreconcilable differences) (Gregor v British – Israil World Federation (NSW) 2002); • Fraud and misconduct by majority directors (Loch v Blackwood Ltd [1924] AC 783). • Need a court order to restrain the Majority Shareholder and Director from passing a resolution to remove minority directors. Eden Resort Hotel Pty Limited [2013] NSWSC 493 (24 April 2013) • Some United States Courts have held that majority directors/shareholders have used the winding-up laws in breach of their fiduciary duty owe to the minority shareholders in circumstances where both the majority directors/shareholders and the liquidator planned the liquidation in order to avoid compensation being paid to the minority. • Failure of the common aim of the company. Seek Legal Advice quickly as these types of disputes can cripple the company.

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& Associates