{"id":190328,"date":"2024-09-11T02:56:20","date_gmt":"2024-09-11T01:56:20","guid":{"rendered":"https:\/\/legalvision.co.uk\/?p=190328"},"modified":"2026-09-21T05:50:37","modified_gmt":"2026-09-21T04:50:37","slug":"resolving-director-disputes","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/disputes-litigation\/resolving-director-disputes\/","title":{"rendered":"Legal Strategies for Resolving Director Disputes"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">A director dispute arises when company directors disagree about how to manage the business or make decisions. If you run a UK company alongside other directors, you may disagree over responsibilities, spending or the company\u2019s future direction. These disagreements can delay decisions and affect working relationships. Checking your company\u2019s agreements and understanding each director\u2019s voting powers can help you identify a way forward. This article explains common causes of director disputes, how to assess a voting deadlock and practical strategies for resolving disagreements.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is a Director Dispute?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A director dispute is when you and another company director disagree on something covering the company or your business. This could concern, for example:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>how you run the business;<\/li>\n\n\n\n<li>your future strategy;<\/li>\n\n\n\n<li>decisions you make; or&nbsp;<\/li>\n\n\n\n<li>management of the company.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Why Might My Company Experience a Director Dispute?&nbsp;&nbsp;<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Your company may experience a director dispute for several reasons, including where:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>a director is insufficiently involved with the business;&nbsp;<\/li>\n\n\n\n<li>a director tries to exercise a greater degree of control over the business when compared to other directors;&nbsp;<\/li>\n\n\n\n<li>family members work in the business, creating <a href=\"https:\/\/legalvision.co.uk\/corporations\/conflicts-of-interest-as-a-director\/\">conflicts of interest<\/a>;&nbsp;<\/li>\n\n\n\n<li>legal compliance issues arise;<\/li>\n\n\n\n<li>a director\u2019s circumstances change;&nbsp;<\/li>\n\n\n\n<li>there is a disagreement over money and dividends; or&nbsp;<\/li>\n\n\n\n<li>a director breaches their duties.&nbsp;<\/li>\n<\/ul>\n\n\n\n\n<a href=\"#content-next\"\n   class=\"mt-10 block rounded-t-xl bg-gray-800 p-4 text-center text-xl font-bold text-white no-underline\">\n    Continue reading this article below the form\n    <i class=\"fa-regular fa-arrow-down text-xl\"><\/i>\n<\/a>\n<div class=\"test mb-10 rounded-b-xl bg-gray-100 px-6 pt-10 pb-12 text-center sm:px-12\">\n    <div class=\"text-orange mb-8 text-2xl font-bold\">\n        Need legal advice?\n        <br>\n        <span class=\"not-prose text-lg\">\n                            Call <a href=\"tel:+448081968584\" class=\"not-prose\">0808 196 8584<\/a> for urgent assistance.\n                <br>\n                Otherwise, complete this form, and we will contact you on the same business day.\n                    <\/span>\n    <\/div>\n\n    \n\n<div class=\"not-prose flex 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You can do so by ensuring that you have a shareholder agreement that specifically details:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>voting rights;<\/li>\n\n\n\n<li>director&#8217;s duties&nbsp;<\/li>\n\n\n\n<li>director\u2019s working hours; and&nbsp;<\/li>\n<\/ul>\n\n\n    <div class=\"my-7 flex flex-col items-start gap-10 border-y-2 border-gray-100 py-7 sm:flex-row lg:my-10 lg:py-10\">\n                    <img decoding=\"async\" class=\"mx-auto my-0! w-52 rounded\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2024\/07\/16031510\/Screenshot-2024-07-16-at-12.14.57%E2%80%AFPM.png\" alt=\"Front page of publication\"\n                 loading=\"lazy\" width=\"208\" height=\"298\">\n                <section>\n            <div class=\"text-2xl font-bold\">UK Directors Duties<\/div>\n            <div class=\"body-text\">\n                <p>Understand your role as a director and how to meet your legal obligations. Download our free guide today.<\/p>\n            <\/div>\n            \n\n<a href=\"https:\/\/go.legalvision.co.uk\/uk-directors-duties.html\" class=\" block px-5 py-3.5 max-w-fit bg-orange button__hover transition rounded text-white font-bold text-lg no-underline uppercase leading-tight text-center\" target=\"\" rel=\"\">Download Now<\/a>        <\/section>\n    <\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\">Strategies for Resolving Director Disputes&nbsp;<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">If you experience a director dispute, you may need to take legal advice from a disputes solicitor. However, there are some steps you can take yourself to attempt to contain the dispute. Your first action should be reviewing your directors\u2019 service or shareholders\u2019 agreement. These documents should outline the:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>role of directors;<\/li>\n\n\n\n<li>rights and responsibilities of directors; and&nbsp;<\/li>\n\n\n\n<li>what should be done if there is a director\u2019s breach or dispute.&nbsp;<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">However, if your business does not have a directors\u2019 agreement or shareholders\u2019 agreement, you should consider:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>your company\u2019s articles of association;<\/li>\n\n\n\n<li>employment protection rights; and&nbsp;<\/li>\n\n\n\n<li>company law.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Your articles of association may detail a dispute resolution process. This could include directors agreeing to <a href=\"https:\/\/legalvision.co.uk\/disputes-litigation\/3-things-to-know-about-mediation\/\">appoint a mediator<\/a> if a dispute cannot be resolved at the board level. Here, a neutral third party will facilitate discussion between the parties in conflict.&nbsp;<\/p>\n\n\n\n<div  class=\"box box--icon box--idea\">\n    <p>Where mediation does not work, you may try arbitration, where an independent arbitrator will make a binding decision on the issue in dispute.<\/p>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\">It may be necessary to take a director\u2019s dispute to court to resolve it. However, this should be avoided if possible, as it can be:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>expensive;<\/li>\n\n\n\n<li>time-consuming; and&nbsp;<\/li>\n\n\n\n<li>stressful.<\/li>\n<\/ul>\n\n\n\n<div  class=\"lawyer-quote my-8 rounded-2xl bg-gray-50 p-4\">\n    <blockquote class=\"not-prose m-0! flex-1 text-center sm:text-left\">\n        <p class=\"mt-0! text-lg italic\">&ldquo;Bring a proposed decision to the discussion, with the approval steps already checked. This gives everyone a concrete outcome to work towards&rdquo;<\/p>\n    <\/blockquote>\n    <figure class=\"mt-4 mb-0 flex flex-row items-center justify-end gap-6\">\n        <img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"300\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-300x300.jpg\" class=\"flex-none w-12 h-12 rounded-full object-cover mx-auto sm:mx-0 wp-post-image\" alt=\"Arjun Krishna\" srcset=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-300x300.jpg 300w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-1024x1024.jpg 1024w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-150x150.jpg 150w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-768x768.jpg 768w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-400x400.jpg 400w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923-600x600.jpg 600w, https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2025\/07\/22012111\/cropped-Arjun-4656-scaled-1-e1753143799923.jpg 1243w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/>        <figcaption class=\"mt-0 text-gray-800 not-italic\">\n            <span class=\"block font-bold\">Arjun Krishna<\/span>\n                            <span class=\"block font-light\">Trainee Solicitor, LegalVision<\/span>\n                    <\/figcaption>\n    <\/figure>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\">The Impact of Unresolved Director Disputes on Your Business<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Unresolved director disputes rarely stay confined to the boardroom. If directors are openly disagreeing over strategy, spending, or control, this uncertainty often filters through to employees, clients, and investors, damaging morale and undermining confidence in the company&#8217;s leadership. Decision-making can grind to a halt, particularly where board approval is required for day-to-day operations, contracts, or financing. This paralysis can cause you to miss commercial opportunities or breach contractual deadlines with suppliers and customers.<\/p>\n\n\n\n<div  class=\"box box--icon box--warning\">\n    <p>There is also a reputational risk. Prolonged disputes that escalate to litigation are a matter of public record and can be picked up by competitors, journalists, or business partners, potentially affecting your standing in the market. Financially, disputes can be costly even before they reach court, given the management time diverted from running the business and the professional fees incurred in seeking advice.<\/p>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\">For these reasons, addressing a director dispute quickly and constructively is not just about resolving a disagreement between individuals; it is about protecting the company&#8217;s operational stability, its relationships with stakeholders, and its long-term commercial reputation. Early intervention, whether through internal discussion or external mediation, is almost always preferable to allowing tensions to fester.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Can a Casting Vote Resolve a Director Dispute?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">An equal split between directors does not always prevent a board decision. Your company\u2019s articles of association set the internal decision-making rules. Check whether those rules give the meeting chair an extra vote to break a tie.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <a href=\"https:\/\/www.gov.uk\/government\/publications\/model-articles-for-private-companies-limited-by-shares\/model-articles-for-private-companies-limited-by-shares\">government\u2019s model articles for private companies limited by shares<\/a> give the chair a casting vote when votes are equal. However, the chair cannot exercise that power if the articles exclude the chair from participating in the decision.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Your company may have changed the model articles, so check the version your company actually uses. Review any relevant conflict of interest before relying on a casting vote.<\/p>\n\n\n\n<div  class=\"box box--icon box--info\">\n    <p>For example, two directors might disagree about choosing a supplier. An eligible chair with a casting vote may resolve that particular decision. The same disagreement may remain unresolved if the company has removed the casting vote.<\/p>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\">Keep board decisions separate from decisions requiring shareholder approval. Directors and shareholders follow different voting rules, even when the same people hold both roles.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Before arranging mediation, identify the exact decision, the required approval and any voting restriction. <a href=\"https:\/\/legalvision.co.uk\/disputes-litigation\/3-things-to-know-about-mediation\/\">Preparing for mediation<\/a> around a specific unresolved decision can help everyone focus on an achievable outcome.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is a Director Despite Deadlock?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A deadlock could arise when you have a director dispute in your company that cannot be resolved due to an equal split between the directors&#8217; and shareholders&#8217; votes. As there is no majority, you cannot pass a <a href=\"https:\/\/legalvision.co.uk\/corporations\/directors-forced-out\/\">shareholders\u2019 resolution<\/a>.&nbsp;<\/p>\n\n\n\n<div  class=\"box box--icon box--info\">\n    <p>To resolve directors&#8217; disputes when there is a deadlock, a court usually orders the company to sell to the person offering the most.<\/p>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Key Takeaways<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A director dispute arises when the directors of a company disagree on matters relating to the business or its operations. Such disputes can occur for various reasons, including a director&#8217;s lack of involvement or a conflict of interest. You should proactively prevent disputes by clearly outlining responsibilities and expectations in the shareholders&#8217; agreement. If a dispute arises, you should check relevant documents, such as the directors\u2019 service agreement or shareholders&#8217; agreement, for guidance. Before pursuing legal action, it is advisable to consider alternative dispute resolution, such as mediation and arbitration.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you are resolving a director dispute, our experienced <a href=\"https:\/\/legalvision.co.uk\/services\/disputes-litigation\/\">disputes and litigation lawyers<\/a> can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. So call us today on <a href=\"tel:+448081968584\" class=\"AVANSERnumber dynamic-number\">0808 196 8584<\/a> or visit our<a href=\"https:\/\/legalvision.co.uk\/membership\"> membership page<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Frequently Asked Questions<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">What causes disputes between company directors?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Directors may disagree about business strategy, workloads, control or dividends. Disputes can also arise from conflicts of interest or concerns about a director\u2019s conduct. Identifying the specific disagreement helps you decide what needs resolving.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Which documents should I check during a director dispute?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Check your company\u2019s articles of association, shareholders\u2019 agreement and any director\u2019s service agreement. Look for voting rules, responsibilities and dispute resolution procedures. Read these documents together to understand the agreed process.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Can mediation help resolve a director dispute?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Mediation can help directors discuss their disagreement with a neutral third party. The mediator helps the parties explore possible solutions. Your company\u2019s articles or agreements may include mediation as part of the dispute resolution process.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Does a director dispute have to go to court?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">No, directors may resolve a dispute through discussion or mediation. Court action may become necessary if those steps do not resolve the issue. Your company\u2019s agreements may specify a process to follow first.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A director dispute arises when company directors disagree about how to manage the business or make decisions. If you run a UK company alongside other directors, you may disagree over responsibilities, spending or the company\u2019s future direction. These disagreements can delay decisions and affect working relationships. Checking your company\u2019s agreements and understanding each director\u2019s voting<a href=\"https:\/\/legalvision.co.uk\/disputes-litigation\/resolving-director-disputes\/\">Continue reading <span class=\"sr-only\">&#8220;Legal Strategies for Resolving Director Disputes&#8221;<\/span><\/a><\/p>\n","protected":false},"author":13569,"featured_media":191839,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","editor_notices":[],"footnotes":""},"categories":[26,28],"tags":[20,40,841,2168],"class_list":["post-190328","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-disputes-litigation","category-corporations","tag-small-business","tag-dispute-resolution","tag-shareholder-resolution","tag-director-disputes"],"acf":[],"yoast_head":"<!-- This site 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