Is a majority shareholder entitled to a corporate lawyer's representation?

Quite recently, in Rice v. Smith, Leach J. dealt with a motion to remove from the record a lawyer who was acting for both the majority shareholders and the corporate defendants in oppression litigation: In matters of legal representation, it accordingly is a fundamental error to regard a corporation as being synonymous with its majority directors and shareholders. Doing so almost inevitably leads to a corporate lawyer's disregard of obligations owed to the corporate body and structure as a whole, in favour of a particular corporate faction. Most notably, the corporate lawyer effectively may ignore his or her obligation to seek litigation instructions from the corporation's entire board of directors, and/or the lawyer's corresponding obligation to share otherwise confidential and privileged litigation information with all of the corporation's directors. It also ignores possible and probable distinctions between the interests of the corporation and such a majority. For example, where conduct of the director or shareholder majority is the real focus of a litigation dispute with a director or shareholding minority, (rather than any conduct of the corporation per se), corporate payment of the majority's legal representation benefits the majority directors and shareholders but not the corporation. It also results in a situation where the minority shareholders effectively are being compelled to pay, at least in part, the legal fees of opposing legal counsel.[14]