When shareholders cannot agree, the business suffers. Jonathan Kleiman represents majority and minority shareholders in oppression claims, deadlock, forced buyouts, and corporate litigation.
· Reviewed by Jonathan Kleiman, J.D.
The oppression remedy under section 248 of the Ontario Business Corporations Act is the most powerful tool available to shareholders. It applies when a corporation's conduct is oppressive, unfairly prejudicial, or unfairly disregards a shareholder's reasonable expectations.
Common examples include majority shareholders diverting corporate opportunities, paying themselves excessive compensation, refusing to declare dividends, diluting minority shareholdings, or excluding shareholders from management.
Deadlock arises when shareholders with equal voting power cannot agree on fundamental business decisions — hiring, firing, major expenditures, or strategic direction. Without a shareholders' agreement containing a deadlock resolution mechanism, the business can be paralyzed.
Directors and officers owe fiduciary duties to the corporation — including duties of loyalty, honesty, and good faith. When a director-shareholder breaches these duties by self-dealing, competing with the corporation, or diverting corporate opportunities, the other shareholders can pursue remedies.
When a shareholder violates the terms of the shareholders' agreement — by transferring shares without consent, competing with the business, or failing to comply with buy-sell provisions — the non-breaching shareholders can sue for breach of contract and seek enforcement.
When the shareholder relationship has broken down beyond repair, a forced buyout — either by agreement or court order — may be the only resolution. Valuation disputes are common, making it critical to have legal representation that understands how businesses are valued in Ontario courts.
Free 30-minute consultation. No fee, no obligation.
Jonathan represents both majority and minority shareholders in corporate disputes across Toronto and the GTA. Whether you need to pursue an oppression remedy, defend against one, negotiate a buyout, or enforce a shareholders' agreement, Jonathan provides the strategic advice and litigation support you need.
Call 416-554-1639 or book a free consultation.
Common questions about shareholder disputes in Ontario.
An oppression remedy is a statutory claim under the OBCA (section 248) that allows a shareholder to seek relief when the corporation's conduct is oppressive, unfairly prejudicial, or unfairly disregards their interests. It is the most commonly used remedy in shareholder disputes.
Yes. Minority shareholders can bring an oppression remedy, a derivative action, or a personal action for breach of a shareholders' agreement.
Deadlock occurs when shareholders with equal voting power cannot agree on major decisions, paralyzing the corporation. A shareholders' agreement with a deadlock resolution mechanism prevents this.
A forced buyout may be ordered by the court as part of an oppression remedy, or triggered by a contractual mechanism (shotgun clause, drag-along) in the shareholders' agreement.
Costs depend on complexity and whether the dispute settles or goes to trial. Jonathan offers a free 30-minute consultation to assess the situation and discuss fee arrangements.
The longer you wait, the more damage the dispute causes. Free 30-minute consultation with a Toronto shareholder dispute lawyer.