Shareholder and director dispute barristers.
Specialist counsel for shareholder disputes, director disputes, unfair prejudice petitions, derivative actions and boardroom deadlock. Fixed fees agreed in writing. Direct access accepted.
Disputes between shareholders and directors are among the most damaging pieces of litigation a private company can face. They combine hostile personal dynamics, technical company law, forensic valuation evidence and, very often, a live trading business whose day-to-day management is being fought over in parallel with the litigation itself. The right barrister on a shareholder or director dispute is one who has run these arguments in the Business and Property Courts many times, understands the Companies Act 2006 machinery, and can advise realistically on when to press for an unfair prejudice buyout, when to threaten a derivative action, and when to negotiate an orderly exit before the litigation destroys the value that everyone is fighting over.
Clerk&Counsel places BSB-registered company law counsel on shareholder and director disputes across England and Wales, including many Legal 500 ranked specialists. We work with solicitors of every size and directly with founders, minority shareholders, exiting directors, family businesses and private equity investors under the Public Access scheme where the matter is suitable for direct access.
We do not charge clients for using our service. Our fees are paid by the barrister as a percentage of their fee for sourcing and onboarding the client and carrying out admin work on the case. Clients are never obliged to instruct the barrister we introduce and are encouraged to compare counsel before deciding.
What shareholder and director dispute counsel cover.
The instructions we route to specialist counsel include:
- Unfair prejudice petitions under section 994 of the Companies Act 2006, including quasi-partnership cases and disputes about withheld dividends, exclusion from management and diverted assets.
- Just and equitable winding up petitions under section 122(1)(g) of the Insolvency Act 1986 as an alternative or parallel remedy.
- Derivative actions under Part 11 of the Companies Act 2006 for breach of directors duties, misappropriation of company assets and self-dealing.
- Disputes about share valuation, drag and tag along rights, pre-emption rights, deadlock provisions and forced sale mechanics.
- Boardroom disputes, removal of directors under section 168 of the Companies Act 2006 and challenges to written and shareholder resolutions.
- Section 172 breach of duty claims arising out of decisions taken by directors said to have failed to have regard to the success of the company.
- Fiduciary duty claims, conflicts of interest, corporate opportunity claims and the accounting exercises that follow.
- Injunctive relief to preserve the status quo pending trial: freezing orders, restraint of AGMs, restraint of share transfers.
- Family-owned business disputes where the shareholding is held across generations and the underlying relationships are as much the problem as the corporate structure.
- Shareholder disputes arising out of investment agreements, term sheets and completion accounts on a completed transaction.
The section 994 route.
An unfair prejudice petition is by far the most common route for a minority shareholder in a private company. The petitioner needs to show that the company's affairs are being conducted in a manner unfairly prejudicial to the interests of members generally or of some part of the members including the petitioner. In a quasi-partnership, where the company was set up on the basis of mutual trust and an understanding that all the shareholders would participate in management, the threshold is lower and the remedies stronger.
The court's remedial toolkit is very wide. In practice the standard remedy is a court-ordered buyout of the petitioner's shares at a fair value, valued at a date the court considers appropriate and, in a quasi-partnership, usually without a minority discount. The court can also regulate the future conduct of the company, restrain specific acts, order the sale of the company and unwind transactions that were part of the prejudicial conduct.
Director removal and duty claims.
A director can be removed by ordinary resolution of the shareholders under section 168 of the Companies Act 2006. That machinery is straightforward on paper but frequently contested in practice, particularly where the director in question is also a shareholder, is party to a service agreement with the company, or is entrenched by weighted voting or bad leaver provisions in a shareholders agreement.
Alongside removal, directors face claims for breach of their statutory duties under sections 171 to 177 of the Companies Act 2006. The most litigated are the duty to promote the success of the company under section 172, the duty to exercise reasonable care, skill and diligence under section 174, the duty to avoid conflicts under section 175 and the duty to declare an interest in a proposed transaction under section 177. The counsel we place act for directors defending duty claims and for companies (or shareholders bringing a derivative action) pursuing them.
Briefing us on a shareholder or director dispute.
When you brief us on a shareholder or director dispute, we:
- Run conflict checks against the company, all shareholders, all directors and any related corporate group.
- Ask for the articles, any shareholders agreement or investment agreement, the last set of accounts and an outline of the dispute.
- Shortlist company law counsel matched to the size of the company and the complexity of the dispute, including King's Counsel where the case warrants silk.
- Confirm fixed fees for initial advice, letters of claim, mediation and hearings.
- Handle Public Access client care paperwork digitally where the matter is suitable.
Specialist areas within this practice.
Shareholder or director dispute on your desk?
Send a short brief with the corporate structure, the parties in dispute and what you want to achieve. A clerk will come back with shortlisted counsel and fixed brief fees.
Common questions.
What is a shareholder dispute?
A shareholder dispute is any contested matter between the shareholders of a company, or between shareholders and directors, about how the company is run, what each shareholder is entitled to receive, and how the company's affairs are to be conducted. The most common shareholder disputes involve minority shareholders who feel excluded from management, withheld dividends, diverted assets, share valuation disputes and boardroom deadlock.
What is an unfair prejudice petition?
An unfair prejudice petition under section 994 of the Companies Act 2006 is the standard remedy for a minority shareholder whose interests are being unfairly prejudiced by the way the company is being run. The court has very wide powers, most commonly ordering a court-directed buyout of the petitioner's shares at a fair value, but also including orders regulating the future conduct of the company, restraining specific acts and unwinding transactions.
Can a director be removed by shareholders?
Yes. A director can be removed by ordinary resolution of the shareholders under section 168 of the Companies Act 2006, subject to any weighted voting or entrenchment provisions in the articles or shareholders agreement. A director removed under section 168 may still have separate claims for wrongful dismissal, breach of a service agreement or unfair prejudice as a shareholder.
What is a derivative action?
A derivative action under Part 11 of the Companies Act 2006 is a claim brought by a shareholder on behalf of the company against a director for breach of directors' duties, typically breach of fiduciary duty, misappropriation of company assets, or conflicts of interest. Permission of the court is required at an early stage. Counsel will advise on whether a derivative action, an unfair prejudice petition, or both in parallel is the better strategic fit.
How is a shareholding valued in a dispute?
The court will usually direct a single joint expert forensic accountant to value the disputed shareholding at a specified date. The valuation methodology, whether earnings-based, net asset value or a hybrid, and the application of minority and marketability discounts, is often the central battleground. In a quasi-partnership the court commonly directs valuation without a minority discount to reflect the true value of the exiting shareholder's stake.
Can I bring a shareholder dispute directly, without a solicitor?
For advisory work, letters before action, mediation and hearings, direct access to counsel is often the most cost-effective route for a shareholder. For proceedings with heavy disclosure, contested valuations and expert evidence, a solicitor-led model with counsel briefed for the key hearings is usually preferable and we can point you to firms that regularly instruct the counsel we clerk for.