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Corporate Dispute Claim
Transactions in which the ownership of companies or the businesses they operate is transferred can be very complex. There are many issues for the purchaser and seller to consider and seek to agree with one another.
Despite the fact that a great deal of effort by the parties and their professional advisers goes into trying to consider and provide for as many conceivable events that might happen post-completion as possible, there are many unforeseen issues that could crop up and lead to a dispute.
If you are involved in a corporate dispute following a business transaction or agreement, or you are considering entering into a deal and wish to fully protect yourself and your business, contact JMW Solicitors today. You can call us on 0345 872 6666 or enter your details into our contact form and someone will get back to you as soon as possible.
The Risks of High Value Corporate Transactions
The complexity of the transaction and the documentation prepared to ensure it is completed to both parties’ satisfaction can be due to a number of factors, including:
- The size of the company/business being sold
- The nature of the business that is being transferred
- Whether the transaction involves the sale of shares in a company or the business and assets
- The extent of the buyer’s knowledge about the acquisition.
- Whether the seller will continue to be involved in the business after the sale
- How the purchase is to be funded, including whether there is to be deferred consideration
- Whether any tax efficient structures are needed by one or both parties.
Trying To Avoid Corporate Disputes
All parties involved will usually work with their professional advisers to negotiate the detailed terms of the sale and purchase agreement. The purpose of doing so is to ensure that the rights and obligations of the parties, and the consequences if they are not fulfilled, are clearly defined at the outset.
The majority of cases we deal with could have been avoided if the proper advice had been taken initially, so we advise that even if it comes at some expense, seeking legal advice before entering into a deal is essential.
There are still occasions where the parties attempt to avoid the expense of that advice and prepare a short form of agreement between themselves, with very limited or no advice. The majority of intractable disputes that we see are those where the parties have not been fully advised. The difficultly they frequently face is that there is no accurate record of what the parties intended should be done if a particular situation should arise later and they have fundamentally differing views about what to do when confronted by the situation.
What Sorts of Corporate Disputes Could Arise?
Where a sale and purchase agreement is in place, the most common issues we see are:
- purchasers alleging that there has been a misrepresentation, breach of contract or even deceit (deliberate and dishonest misinformation) on the part of the seller; or
- sellers who have not been paid in full or are receiving demands from purchasers to repay monies because of allegations about the warranties and disclosure provided by the seller in the course of the transaction.
However, a wide range of other issues can crop up about the management of the business subsequent to the sale or technical issues relating to the transaction itself.
What Action Can You Take to Resolve a Corporate Dispute?
Our corporate dispute resolution services are varied and include:
- adopting any method that may have been prescribed within the sale and purchase agreement for achieving a resolution - expert determination by an accountant is common
- court proceedings