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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 32086
Experience:  Over 5 years in practice
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I am a 50% shareholder & joint director in a limited company

Customer Question

I am a 50% shareholder & joint director in a limited company but the other director continually refuses to keep me informed of what he is doing or discuss decisions before he makes them. We have nothing in writing so What legal rights have I got to make him communicate with me?
Submitted: 2 years ago.
Category: Law
Expert:  Ben Jones replied 2 years ago.
Hello, my name is***** am a qualified solicitor and it is my pleasure to assist you with your question today. What reasons has he given for this, if any at all?
Expert:  Alex J. replied 2 years ago.
Thank you for your question and welcome.
My name is***** am a company law expert and my colleague has asked me to assist you.
What sort of decisions is he making? Signing contracts? Spending money etc?
Kind regards
Customer: replied 2 years ago.
Myself & My husband, who I have been seperated from for 2.5yrs & am in the process of divorcing own a Care Co. Which we have had sinc 2000. we are 50/50 sharholders & both the only Directors. He makes decisions all the time without refering to me & when I disagree ignores me - for instance re-employing his girlfriend who worked for us & left in December 2013. He re-employed her in March 2015 although I said no. He has negociations about buying additional Care businesses & I dont find out until the deal is done. Staff know before I do. I am a qualified ACCA accountant & run this side of the business, he is on the Sales side & oversees the Care Mangers on a day to day business & does grow the business, there are aspects about this that I feel I should know about, when he knows about them, but he goes out of his way to keep me in the dark. What can I do about this?
Customer: replied 2 years ago.
Hi Alex I presume I will get an email when you reply.
Expert:  Alex J. replied 2 years ago.
Thank you.
Did he previously used to involve you in these decision making processes?
Is he able to make financial decisions without your approval?
Would he be prepared to sign a shareholders agreement?
Kind regards
Customer: replied 2 years ago.
Yes when we were together as Man & Wife I was involved in All decisions - This was up to June 2013.
In fact I used to see all emails to his Co. email address, so that I was kept in the loop - but he removed this option & our Systems consultant wont reinstate it without his permission. we see all staff emails so I cant see why I shouldnt see his - Have I a letgal right to see them? When I ask about decisions made, as to why I wasnt referred to - he says I didnt need to know!!!
He does make financial decisions without my approval but I feel that he shouldnt.
I dont know if he would sign a shareholders agreement - I need something that is acceptable & the normal in law & assumed as a 50% shareholder & joint Director there would be some precedent for this, as to what is normal acceptable & if need be would be enforced by a court?
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. The onyl way to force him to co operate going forward is by agreement - you need a shareholders or some formal structure for ensuring compliance. If he refuses then the company is potentially deadlocked and all you would be able to do is sue him on behalf of the company for breach of director duties - this would be very expensive and time consuming with no guarantee of success. You have to ask yourself - do you want to actually work with this individual going forward? Can you control him or compromise with him?