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Below is a series of original articles discussing various issues in the area of Irish commercial law. They are all original works written exclusively for Corporate Legal. Feel free to link to them from your own website or use them offline. Please note that nothing in these articles is intended to be legal advice and it should not be treated as such. This section will be updated from time to time with new material, so please check back regularly.
Duties of company directors: steps for enforcement
Subject: Company law, director duties, minority shareholders, derivative action
Date added: 7th June 2024
Much is written and said about the duties of company directors. However, there is much less information out there about the mechanisms for enforcement against directors who breach their duties. This article provides some practical steps which can be taken by a member of a company who believes that one or more of its directors are in breach of their duties... Read More...
Can shareholder oppression proceedings be heard in private?
Subject: Company law, minority shareholders, oppression, section 212, private hearings
Date added: 7th June 2024
The High Court (Cregan J) recently delivered judgment in the case of Re Glenman Corporation Limited 2024 [IEHC] 304, an application that proceedings under section 212 of the Companies Act 2014 (oppression of a minority shareholder) should be heard otherwise than in public... Read More...
Defending mortgage proceedings against the family home
Subject: Personal Insolvency, Mortgages, Litigation, Family home
Date added: 27th February 2024
More than a decade following the global financial recession (and the Irish property crash which accompanied it), the courts are still dealing with a significant number of families at risk of losing their family homes as banks, many of which have long ceased trading in Ireland, seek to enforce mortgages by taking possession of properties. While the number of possession cases have decreased in the past few years, we continue to receive enquiries about them from families desperate to find solutions or possibly even defences to the bank's claim... Read More...
Voting by companies at creditors' meetings
Subject: Corporate Insolvency, Voting, proxies, creditor meetings, voluntary liquidation
Date added: 16th January 2024
When a company is being wound up by way of a creditors' voluntary winding up, it is necessary to convene a meeting of its creditors. The primary purpose of this meeting is to appoint a liquidator which can be the person nominated by the members at their meeting or some other person chosen by the creditors. Since the company is insolvent, the interests of its creditors are paramount as they are the only ones likely to receive anything in the liquidation... Read More...
Liquidator's conflict of interest when acting for related companies
Subject: Corporate Insolvency, Liquidator duties, Conflicts of interest
Date added: 10th January 2024
A liquidator is not an officer of the company to which he is appointed. He is an agent of the company. Nevertheless, a liquidator owes fiduciary duties to the company. If the company is insolvent then those duties are more precisely owed to its creditors who are the primary stakeholders in the liquidation. Even in the context of an insolvent liquidation however, there are often competing interests... Read More...
Shareholder oppression: when does it exist?
Subject: Minority shareholders, Oppression, Company shareholder rights
Date added: 23rd November 2023
We are often asked to advise clients who are minority (or 50%) shareholders of companies and who have had a breakdown of relations with the majority (or other 50%) shareholders. In such cases, lawyers will ask for (a) list of every action done by the majority which it is alleged amounts to conduct which is oppressive and (b) evidence of those actions. The purpose of the exercise is to examine whether the case falls within section 212 of the Companies Act 2014 as one of oppression or disregard of the client's interests as a shareholder.... Read More...
Negotiating and drafting Software-as-a-Service Agreements with customers
Subject: Software licence, SaaS agreements, commercial contracts
Date added: 20th November 2023
While Ireland is well known for being the European headquarters of some of the world's largest tech companies, the country has also seen a sharp increase in home-grown technological ingenuity. There is an ever-expanding spectrum of IT services and products hitting the market off the Irish conveyer belt – whether it is a startup rolling out its aspirational revolutionary technology or a reseller having identified gaps in the European market for tried and tested products.... Read More...
Rights of company shareholders
Subject: company law, company shareholder rights, company constitution, shareholder agreement
Date added: 27th July 2023
While the owner of a share has proprietary rights in the shareholding, these are different from the rights associated with the ownership of other kinds of property, such as real property. For example, the legal owner of a house is entitled (indeed obliged) to have his/her ownership registered in the folio maintained by the Land Registry. No such right exists when it comes to the purchase of shares in a company – the directors have a broad discretion to refuse to register a new owner of shares in the company's register of members.... Read More...
Steps for restoring a company to the register
Subject: company law, company restoration, court application, section 738
Date added: 2nd June 2023
The following are some general guidelines for restoring an Irish company to the register of companies. While we hope that they will be of some assistance to readers, please note that this is a complex area of law and it is recommended to seek specialist legal advice, particularly when it comes to making court applications for restorations... Read More...
Resolving shareholder disputes
Subject: company law, minority shareholder oppression, shareholder remedies, section 212
Date added: 2nd June 2023
Below are some basic steps and guidelines for minority shareholders of Irish companies who believe that the conduct of the majority shareholders is unfair or oppressive. These guidelines were prepared based on our experience of such cases in companies of various sizes and involving a wide range of disputes. Some of these disputes can be resolved quickly, others may go to formal mediation and a small number resort to litigation... Read More...
How to remove a company director
Subject: company law, company director, legal fees, removing a director, section 146
Date added: 15th December 2022
It is an unfortunate but predictable fact of commercial relationships that, at some stage, they are likely to encounter conflict. This may be a "bump in the road" or perhaps something more serious and lasting. Disputes between company shareholders and directors normally fall into the latter category. The classic situation is where, in the context of a relatively small company, disputes emerge between the shareholders. One or more of those shareholders will also be a director of the company... Read More...
Company restoration in the High Court - some practical questions
Subject: company restorations, strike-off, legal fees, company law
Date added: 1st December 2022
The following are answers to some common questions I get from company directors who wish to make application to the Hugh Court for the restoration of a company which has been struck off the register. A more detailed article about company restorations is available here... Read More...
Legal status of Heads of Agreement and Term Sheets
Subject: Heads of agreement, contract law
Date added: 9th July 2021
When parties enter into negotiations, one of the first documents they produce between them is often headed a "heads of agreement" (HOA), "term sheet" or "heads of terms". It is normally drafted by the negotiators themselves since it is often too early in the relationship for either of them to have engaged lawyers.... Read More...
Company restorations in the High Court - key considerations>
Subject: Company restoration, company strike-off
Date added: 11th June 2021
A few years ago, a company director telephoned me seeking legal advice. He recounted how his company was on the brink of obtaining approval for a substantial bank loan when a bank official discovered at the eleventh hour that, in fact, the company had been struck off the register almost five years previously. "I was sitting there in my bank manager's office, red faced" said the director. "We needed the loan urgently and we did not get it".... Read More...
Software developers and entrepreneurs: some legal considerations
Subject: Software development, copyright
Date added: 14th August 2020
Ireland is fast becoming a centre for technological innovation. In many cases, the brains behind the technology are based in Ireland while, in others, they are based abroad but decide to operate through an Irish company. While an influx of technology companies into Ireland is to be welcomed, it should come with the same warnings as apply to any other business. The most important of these - and I simply cannot emphasise it enough in the case of technology and software companies - make sure to get legal advice before entering into legal relationships! Emphasis on the word "before"!... Read More...
Receivers and existing tenancies
Subject: Receivership, banking law
Date added: 16th July 2020
I was recently browsing through some online auction properties when I came across one of particular interest. It was an apartment in Dublin 4, a penthouse in the so-called "posh" part of the city. Being the posh part of the city, one would have expected the apartment to be selling for around €150,000 more than its advertised starting price. True that these auctions often start at rock bottom prices to draw the crowds, but this seemed well below rock bottom. What, I wondered, could be wrong with it?... Read More...
Non-party costs in commercial litigation
Subject: Commercial litigation, Legal costs
Date added: 11th June 2020
The Supreme Court recently gave a final determination on whether or not a person can be made liable for the costs of legal proceedings to which he is not a party. The decision in question came in the case of Moorview Development Limited v. First Active Plc [2018] IESC 33, an appeal from the judgment of Clarke J in the High Court. Such appeals would now be heard by the Court of Appeal rather than the Supreme Court, but the Moorview case was appealed prior to the establishment of the Court of Appeal and therefore remained in the Supreme Court list for hearing. The issues in question are of tremendous importance in Irish commercial litigation. In particular... Read More...
The compulsory winding up of companies - some practical considerations
Subject: Liquidation, corporate insolvency, debt recovery
Date added: 1st March 2020
Every year, hundreds of applications are made to the High Court for the compulsory winding up of companies. The vast majority of these are made by creditors in respect of companies which owe them significant sums of money. Prior to the commencement of the Companies Act 2014, the application could be made by creditors owed a minimum of €1,000 (or thereabouts) but that was raised by the 2014 Act to €10,000 or €20,000 whhere two or more creditors combine to make the application. The following are some of the practical considerations arising for the parties.... Read More...
Defending company directors from restriction and disqualification
Subject: Liquidation, Restriction of company directors
Date added: 17th June 2019
It is a nightmare of every company director that their company becomes insolvent and wound up, and that they are hauled before the court for their restriction and disqualification. No director is immune from this possibility, but not all seem to do enough to prevent it from happening. So common is this unfortunate scenario that the High Court has a special list dealing specifically with restriction applications (although admittedly the number of cases in that list has decreased significantly since the introduction of "voluntary" restriction and disqualification by the Companies Act 2014).... Read More...