Can a shareholder of a closely held corporation change from an equal partner to a minority shareholder?
British Columbia, Canada
The following excerpt is from Icahn Partners LP v. Lions Gate Entertainment Corp., 2010 BCSC 1547 (CanLII):
In Cross v. Mountain High Recreation Ltd., 2007 BCCA 121, three partners held roughly equal positions in a closely held corporation from the date of incorporation and for some years thereafter. There was confusion regarding the terms of a share offering and acceptance. The court found that in the case of closely held corporations a shareholder had equitable as well as legal rights. The corporation fit within a “quasi-partnership” description, so going from an equal partner to a minority shareholder was sufficient to trigger relief in the circumstances before the court.
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