Expertises connexes

Despite all contracts and precautions that may be taken, no one is safe from the occurrence of a conflict within a business. In a deadlock, it may be necessary to turn to the courts to resolve the dispute and free the company from paralysed management generally caused by the conflict.

The shareholders of a corporation are protected by law in various ways, whether they represent the majority or a minority. They have access, among other things, to the oppressive remedy (the principle of legitimate expectations). They can demand the enforcement of many rights if they feel they are related to their status of shareholder (salary, position of director, payment of bonuses, access to financial documents and other).

The situation may be even more complex where a shareholder is also an employee of the company. Indeed, the shareholder-employee also enjoys the protection of labor laws, his individual employment contract and perhaps from a union. Whether it relates to breach of the duty of loyalty further to a dismissal, psychological or sexual harassment, non-compliance with labor standards, illegal dismissal, non-compliance with the collective agreement or employer’s liability due to the fault of the employee, the shareholder-employee enjoys all these legal protections, as if it was just an employee.

In all the cases mentioned above, the available judicial procedures differ, although there is always a possibility of negotiating a settlement. The study and analysis of corporate documents and shareholder agreements, if applicable, will often be the first task in assessing the situation and understanding the rights of the parties. Thereafter, it would be wise to evaluate the option of redeeming the shares by another shareholder or by the company itself before talking about liquidation of the company or of dismissal and removal.

In all cases, in order to facilitate the chances of a satisfactory outcome for everyone, it is essential to adopt an irreproachable conduct, exempt of bad faith, despite a turbulent situation.