Wills and Planning Ahead
Derivative Claims Guide For Shareholders
Summary
Sometimes, the people in charge of a company do things that hurt the company or its shareholders, like making a bad decision or acting unfairly. Derivative claims give shareholders a way to step in and take legal action on behalf of the company even if the company fails to take action. In this article, we’ll look at what derivative claims are, who can bring these types of claims, potential pitfalls, and how to bring a derivative claim. * Majority and minority shareholders * Trustees * Personal representatives (in the context of probate). Shareholders can also continue a derivative claim if the company is unable or unwilling to pursue it further, and the shareholder believes it’s in the company’s best interest to continue. It’s important to note that these claims are intended to protect the company, not individuals. So, the role of the person bringing a derivative claim is that of a representative of the company seeking to protect the company’s interests and hold directors accountable. If you believe you have grounds for a derivative claim or have questions about your eligibility to bring such a claim, contact our legal assessment team today for a free case evaluation and quote for.
Key information
- Majority and minority shareholders
- Personal representatives (in the context of probate).
- Making decisions that benefit themselves, not the company
- Not exercising reasonable care, skill, and diligence in decision-making
- Failing to promote the success and sustainability of the company
- Not declaring personal interests they have in deals the company is involved in
- Sometimes, the people in charge of a company do things that hurt the company or its shareholders, like making a bad decision or acting unfairly. Derivative claims give shareholders a way to step in and take legal action on behalf of the company even if the company fails to take action.
- In this article, we’ll look at what derivative claims are, who can bring these types of claims, potential pitfalls, and how to bring a derivative claim.
- Majority and minority shareholders * Trustees * Personal representatives (in the context of probate).
- Shareholders can also continue a derivative claim if the company is unable or unwilling to pursue it further, and the shareholder believes it’s in the company’s best interest to continue.
- It’s important to note that these claims are intended to protect the company, not individuals. So, the role of the person bringing a derivative claim is that of a representative of the company seeking to protect the company’s interests and hold directors accountable.
- If you believe you have grounds for a derivative claim or have questions about your eligibility to bring such a claim, contact our legal assessment team today for a free case evaluation and quote for the services of a specialist corporate lawyer.
Practical guidance
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Sources
- Lawhive — Derivative Claims Guide For Shareholders
This is signposting information from the Legal Shaman wiki, not legal advice. Always consult a qualified solicitor for your situation.