Directors disputes

Directors play a pivotal role in helping companies to achieve their strategic objectives and to operate effectively and efficiently. As such, it is important that they perform their role well an that they command the trust and respect of those they have been appointed to lead. It is also important that conduct themselves in a way that is beyond reproach and that where mistakes are made these are owed up to quickly.

Where the behaviour of a director falls below expected standards, there is potential for a dispute to arise — whether it is with fellow directors, shareholders, corporate lenders, secured creditors or employees. There is also potential for conflict where a director chooses to leave unexpectedly or an insolvency practitioner is appointed.

Whatever the circumstances, it is important that where a dispute occurs it is tackled head on and that decisive action is taken to achieve a prompt resolution on sensible and commercially acceptable terms.

This is something that the corporate solutions lawyers at IMD Corporate can help you to do, whether your involvement in the dispute is as the director whose actions have come under scrutiny, a representative of the company’s board or someone else.

We have broad experience in a range of director-related matters and particular expertise in the resolution of disputes between directors and shareholders over poorly made or executed business decisions.

How we can help

Working alongside our dispute resolution colleagues, we can help deal with:

• disputes where a director is alleged to have breached their statutory duties under the Companies Act 2006;
• disputes where a director is alleged to have exceeded their powers, or failed to follow internal rules, as set out in the company’s articles of association and other constitutional documents;
• disputes where a director is alleged to have failed to give effect to the statutory or contractual rights of shareholders;
• disputes where a director is alleged to have behaved inappropriately, such that the company feels entitled to terminate their service contract;
• disputes where a director has been removed from their position and is claiming unfair dismissal or some other breach of employment laws;
• disputes where a director has left the company and is allegedly acting in breach of a restrictive covenant;
• disputes where a director is alleged to have contributed to a company’s collapse into insolvency, including where they are accused of wrongful trading or of sanctioning a transaction at an undervalue or one that amounts to a preference; and
• disputes with an insolvency practitioner who is trying to force the director to make a personal contribution to company funds or to have them made subject to a director’s disqualification order.