Corporate disputes settlement

Jan, 01 2024


Currently, legal entities in the process of carrying out commercial and entrepreneurial activities often face conflict situations not only with respect to counterparties, partners, and business rivals, but also with disputes arising within the organization itself. This category of disputes is one of the most common in the field of organizations and is called corporate disputes.

As a rule, corporate disputes are the result of unilateral or mutual claims of some company members against others. Corporate conflict cases are considered the most difficult category of cases when they are considered by judicial authorities due to the need for a detailed and detailed study of the factual circumstances of the dispute. In addition, such conflicts often go beyond the scope of civil proceedings due to the possible involvement of the parties to criminal liability.

In Russian legislation, corporate disputes are allocated to a separate category of cases, which emphasizes their importance for business activities.

In accordance with the provisions of Article 225.1 of the Arbitration Procedure Code of the Russian Federation (hereinafter referred to as the APC of the Russian Federation), arbitration courts consider cases on disputes related to the creation of a legal entity, its management or participation in a legal entity that is a commercial organization, as well as a non–profit organization uniting commercial organizations and (or) individual entrepreneurs. At the same time, the issue of defining a particular dispute as a corporate one is complex: the conflict can be complex and contain both elements of a corporate dispute (within one organization) and an unincorporated one (between different organizations) which entails an ambiguity in the interpretation of its category.

According to Russian law, corporate disputes are subject to arbitration courts, but there is also the possibility of their consideration in arbitration courts. However, this approach is used infrequently, and mostly such cases are considered in arbitration courts.

In accordance with the established practice of law enforcement in relation to Chapter 28.1 of the APC of the Russian Federation, a dispute is recognized as corporate in the following cases:

  • the company’s participants demand compensation for losses caused to the legal entity, invalidate the transaction of the legal entity or apply the consequences of the invalidity of such a transaction;
  • the dispute is related to the creation, reorganization and liquidation of a legal entity
  • a dispute between the corporation and its head, including the former, related to the activities of the sole executive body
  • the dispute is related to the conducting of a general meeting of participants, as well as the appeal of decisions of the management bodies of a legal entity
  • when establishing the encumbrance of a share in the authorized capital of business entities and the exercise of the rights arising from this – if they are related to the ownership of such a share;
  • dispute related to the issue of securities;
  • ownership and distribution of shares in the authorized capital of business entities is disputed;
  • disputes related to the ownership of shares, the establishment of their encumbrances and the exercise of the rights arising from them.
  • disputes arising from the activities of notaries to certify transactions with shares in the authorized capital of limited liability companies.

Thus, in the event of conflict situations within the company, a person who wants to protect his rights in court must reliably determine whether the dispute will be corporate or not: this is what will make it possible to correctly draw up and file a statement of claim.

2. Protection of the interests of the parties to the corporate conflict in court

In most cases, corporate disputes are settled by the courts on the basis of documentation provided by the parties to the conflict. This is due to the fact that such legal relations are always connected with the document flow of the company or its bodies. Therefore, the tasks of lawyers representing the parties to the conflicts include careful preparation and formation of an evidence base based precisely on the internal documentation of the company.

In addition, as a rule, disputes within corporations are accompanied by significant financial requirements, therefore, even at the stage of filing a claim to the court, a petition for the imposition of interim measures – a ban on certain actions, the seizure of property and other assets of the defendant may be filed with it. Competent drafting of a statement of claim and a similar petition is also an important task of a lawyer representing a party in a corporate dispute.

The judicial process itself in the framework of the consideration of such cases in arbitration courts is practically no different from the consideration of non-corporate disputes.

Representation of the interests of a company or an individual-a party to the conflict, as a rule, is carried out either by the company’s in-house lawyers or by representatives of third-party law firms with a power of attorney. All procedural actions, including appeal of a court decision and representation in the courts of appeal and cassation, are also included in the terms of reference of representatives in this category of cases.

VALEN Company offers services of judicial representation in cases within the framework of corporate dispute resolution, has considerable experience in the successful conduct of such cases. Our specialists will analyze your situation, help in developing a dispute resolution strategy, prepare a legal position, collect and file the necessary set of documents in court and implement the protection of the client’s rights in court. Contact us and we will help you successfully defend your rights in arbitration courts of all instances.

You can also contact our lawyers by any of the available means of communication and visit the VALEN office, having previously made an appointment by phone +7 (495) 7-888-096.

Author of the article
Corporate disputes settlement
Valentina Khlavich
Managing Partner
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