Should we start a new corporation because of a unresolvable dispute with 1 out of 6 business partners?

UPDATED: Apr 11, 2012

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

UPDATED: Apr 11, 2012Fact Checked

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

Should we start a new corporation because of a unresolvable dispute with 1 out of 6 business partners?

I currently have a corporation with 6 business partners that have equity and things are not working out with 1 of them. They have not been doing the work they promised. The company has not launched yet but the partner that does not want to leave has put in some money. The person is shareholder and officer of the corporation. However they are not on the board of directors. The board as well as the rest of the shareholders sent him a resolution offering him his money back, as well as compensating him for his time but they do not want to leave.

Asked on April 11, 2012 under Business Law, Illinois


Glenn M. Lyon, Esq. / MacGregor Lyon, LLC.

Answered 10 years ago | Contributor


Depending on the authority granted by the corporations internal documents (by-laws, shareholders agreement, etc.), you may be able to dissolve the company and move on to start a new one. If not, you and the other partners still have the right to start a new company, but you must be careful not to create any minority oppression liability by negative acts against the other shareholder.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption