Legal Question in Business Law in New York

Private C corp.

My business has three partner. There is one majority ( over 51%)partner, I have 35%. Can the board of directors vote him out if there is evidence of questionable practices by him and for his benefit and not the company?????? What are my legal parameters


Asked on 1/13/07, 7:14 pm

2 Answers from Attorneys
John Friedman Law Office of John K. Friedman

Re: Private C corp.

The board can but, if this partner owns 51% absent a voting agreement to the contrary, he can simply replace the board. If this is a NY corporation the majority owner may owe higher fiduciary duties to you and the other minority investor but it will be difficult to impose them absent a court battle most likely.

I would look first to the by-laws of the company and any shareholder agreements (voting agreements, trusts, etc.) to learn what the limits on shareholder action are.

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Answered on 1/14/07, 11:43 am
Marshall Isaacs Marshall R. Isaacs, Attorney At Law

Re: Private C corp.

Absent an enforceable provision in the by-laws providing otherwise, a majority vote of the shareholders is necessary to remove a director. Short of a majority, the holders of ten percent of the shares or greater can petition the court to have a director removed.

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Answered on 1/14/07, 11:52 am


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