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Courts Actions: Shareholder Deadlock

If shareholders are in dispute and have reached a deadlock, what can they do?  They can of course apply to Court for a remedy, and available Court actions are touched on below, but going to Court is almost invariably a very bad idea.  Instead of asking a Court to make a decision about what happens, it’s better for the shareholders to agree in advance.

If shareholders are in dispute and have reached a deadlock, the following remedies may be available through Court under the Corporations Act: 


  • Winding-up under section 246 or 233 of the Corporations Act

  • Appointment of a receiver or a receiver and manager

  • A buy-back of shares by the company

  • Modification or repeal of the company's constitution

(For more information, see Company Wind-ups and Shareholder Oppression under Section 232).

Agreement Instead of Court


Going to Court can be much like playing Russian Roulette.  Why not play your own Russian Roulette without the cost, stress, time-wasting and uncertainty?  Or earnestly try to reach a settlement through Mediation.

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If you would like to discuss any aspect of this article with us, or share your own experiences, please contact Rod Stumbles at +613 8692 7255 or here.




This article provides general information only and is not intended to constitute legal advice.  No lawyer-client, solicitor-client or attorney-client relationship has been created between us.  You must not rely on the contents of this article, whether as an alternative to legal advice from a lawyer or other professional legal services provider or otherwise.  You should not take, discontinue or refrain from taking any action because your understanding of the contents of this article, including without limitation delay seeking legal advice or disregard legal advice.  If you have any specific questions about any matter, you should engage us or other lawyers or other professional legal services providers to provide you with the necessary advice.  Keep in mind that you may be facing important deadlines so you should not delay in engaging someone to provide you with the advice.

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