Change in Shareholders - Disputes

Contact Neufeld Legal PC at 403-400-4092 / 905-616-8864 or

When conditions change amongst shareholders or with the corporation, its officers and/or directors, this can impact relations and require legal action to protect one's corporate interests.

The reality is that even though a company's shareholders may have been on the same page on day one, people change and situations change over time, such that disputes can arise from a relationship that was previously viewed as working 'perfectly'. Yet for a broad array of reasons, shareholders can find themselves at odds and need to facilitate their separation, whether it is through an exited strategy provided by a unanimous shareholders agreement, a negotiated resolution or court litigation. Reasons for shareholders coming into conflict with one another, such that their separation becomes a necessity for the parties to move forward, which can include:

- financial issues (i.e., personal debt, gambling)

- medical issues (i.e., bipolar, schizophrenia, terminal illness)

- health issues (both personal and family related)

- family issues (i.e., divorce, separation, adultery)

- addictions (i.e., alcohol, drugs, gambling)

- differing perspectives on the future of the business and its financing.


When a shareholder is suffering from a serious medical issues, i.e. bipolar, schizophrenia, dementia, delusional, paranoia, it is in your best interests to seek appropriate legal counsel to protect one's corporate interests.

When one of a company's principal shareholders, directors or officers is suffering from a serious medical condition, which is either impacting or has the potential to impact the company in a negative manner (and in turn the corporate share value), it is important to obtain appropriate legal counsel to protect your interests in the company.

It is unfortunate that people are susceptible to medical conditions that adversely impact their mental state and thereby have the potential to have a negative effect upon the company. Whether the particular individual is suffering from schizophrenia, bipolar, dementia, psychosis, alzheimer's, delusional, paranoia, depression or some other negative mental state, it is important that you look to address this early on and undertake appropriate precautionary actions, so as to protect both the company and your corporate interests therein. Allowing the situation to deteoriate as a result of one individual's unfortunate medical condition, without undertaking appropriate remedial action, is rarely, if ever, a smart course of action.


The personal issues of corporate shareholders and executives (directors and officers) can be extremely damaging to a corporation and its share value. As such, when personal issues such as divorce, drugs, alcohol or gambling has a negative impact on the company and its future, it is extremely important that the other shareholders take appropriate action to address the situation, given that a failure to act appropriately could have a negative impact on both their own finances and their engagement with the company. And this is where knowledgeable legal counsel needs to be retained, such that the appropriate course of action might be developed to deal with the particular situation, while remaining compliant with applicable laws and contracts (which can be quite onerous).


Shareholder (executive) greed and dishonesty are two principle reasons for disputes between shareholders. For when such actions are taken by one or more shareholders against the company and the other shareholders (and stakeholders in the business - creditors, suppliers, customers), there must be swift and stern legal action taken. Yet in undertaking such legal action, it is important that there is a strong foundation for one's accusations. Seeking recourse by dispute resolution (mediation, arbitration, litigation) requires evidence, so as to substantiate one's claims, failing which alternate legal strategies need to be engaged, that are not reliant upon such evidence.

At Neufeld Legal P.C., we undertake significant and complex shareholder disputes, amongst shareholders or with the company, its directors and/or officers, creditors or other third parties. Contact us at 403-400-4092 [Alberta], 905-616-8864 [Ontario] or

Shareholder ChangeFreeze-OutPost Buy-OutOwnership AttackMinority/OppressionDerivative ActionExcess CompensationValuation IssuesTransfer DeniedCorporate DeadlockDeath/Disability


What is a Unanimous Shareholders Agreement?

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