When Company Directors and Shareholders Come to Blows

When Company Directors and Shareholders Come to Blows

In companies both large and small, relationships between shareholders and directors can and do run into difficulty occasionally. When that happens, you have several remedies to choose from in the Companies Act. One of them, “relief from oppressive or prejudicial conduct” is particularly versatile, with courts empowered to order a wide range of remedial action ranging from share transfers to removal of directors, liquidation or business rescue of the company, and much more. Indeed, a court may make any order “it deems fit” – but before you get there, you must first prove one of three specified categories of oppressive/prejudicial…
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Directors and the “Delinquency” Danger

Directors and the “Delinquency” Danger

“Directors have clear responsibilities to the public in the form of investors, creditors, shareholders, employees to perform in a fashion wherein not only does the company behave in an accountable manner to these stakeholders but that it adheres to a level of transparency which ensures that the principle of accountability is vindicated” (extract from judgment) Directors face many challenges, not least amongst them the constant danger of being held personally liable for any failure to comply with their statutory duties.  In addition to facing civil claims for losses sustained, and even possible criminal liability, directors risk being declared “delinquent”. And…
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Starting a Business in 2017: The Private Company Option

Starting a Business in 2017: The Private Company Option

Episode 4 In our last article in the series “Choosing the right legal entity for your business” we looked at the partnership option [link] for starting a new business. Let’s move on to the private company option, where your business is owned and operated, not by you as an individual or by a group of individuals, but by a “(Proprietary) Limited” or “(Pty) Ltd”. Although close corporations (CCs) still exist, no new ones are registered, so we will not consider them here other than to note that the owners of a CC are “members” not “shareholders”). What is a private company? Our…
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