Shareholder and partnership disputes
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When a business relationship breaks down, the argument almost always ends up being about numbers.
What is the shareholding worth. What has been taken out. Whether the accounts show what actually happened. Whether the person on the other side has been running personal spending through the company, or diverting work, or simply valuing their own shares rather generously.
We do the accounting side of that. Independent valuations of disputed shareholdings, forensic examination of the financial records, and expert evidence that holds up when it is attacked.
What these disputes usually look like
A minority shareholder is being squeezed out. No dividends, no information, no seat at the table, and an offer for their shares that bears no relation to what the company is worth.
Two founders have fallen out. Both still directors, both still signing, neither trusting the other, and the company slowly suffocating between them.
Money has gone missing, or appears to have. Expenses that are not expenses. A supplier nobody has heard of. Work invoiced through a different company.
A partnership is dissolving. And the partnership agreement is either silent, ambiguous, or written on the back of an envelope in 2009.
Someone has died or divorced, and their shareholding is now held by somebody who was never part of the business and wants out.
Why the valuation is usually the whole fight
Because a minority shareholding is not worth a proportionate slice of the company.
If you own 20% of a business worth £2 million, your shares are not automatically worth £400,000. A minority stake controls nothing: it cannot force a dividend, cannot force a sale, cannot appoint a director. The market discounts that heavily, and the size of the discount is a matter of judgement.
So the party buying will argue for a large discount. The party selling will argue for none. In an unfair prejudice claim, the court may direct that no discount applies at all.
That single question can be worth six figures, and it turns entirely on the basis of valuation, the evidence, and how well the reasoning is argued. It is not arithmetic. It is advocacy supported by arithmetic.
How we help
Independent valuation of the disputed shareholding. Prepared to be tested, with the basis and assumptions set out in full, and the discount question addressed head-on rather than buried.
Forensic examination of the records. Tracing what was actually taken, when, and by whom. Reconstructing accounts where the records are incomplete or have been dressed up. Quantifying loss.
Expert evidence. Where the matter goes to court, we can act as an expert. That means our duty is to the court and not to whoever is paying us, and a report written any other way is worthless anyway. An expert who reads as a hired advocate is destroyed in cross-examination, and takes the case with them.
Support to your solicitor. Most of this work runs alongside litigation. We work to your lawyer's instructions and give them the financial ammunition, or the honest news that they do not have any.
We will tell you if your position is weak
This matters more in disputes than anywhere else.
People in conflict want to be told they are right. An adviser who tells you what you want to hear will happily bill you for two years and lose.
If the numbers do not support your case, we will say so early, while you still have the option of settling on decent terms. That conversation is unwelcome and it is the most valuable thing we can offer you.
What it costs
Priced individually, and disputes vary enormously. A single valuation report for a negotiated buyout is a defined piece of work. A forensic investigation running alongside contested litigation is not, and anyone who quotes a fixed fee for one has not understood it.
We will scope it, tell you the fee for the first stage, and tell you before the cost of the next stage exceeds what it might recover. Litigation that costs more than it wins is not a victory.
Shareholder and partnership disputes: frequently asked questions
How is a minority shareholding valued?+
Usually by valuing the whole company, then taking the proportionate share, then applying a discount to reflect the lack of control and the difficulty of selling the stake. The size of that discount is often the central dispute. In unfair prejudice claims, courts have frequently directed that no discount should apply, which changes the figure dramatically.
Can you act if the other side is using their own accountant?+
Yes. That is the normal situation. Each side instructs its own expert, and in court proceedings the two experts are usually required to meet and narrow the issues in dispute before trial.
Can you be an expert witness?+
Yes. In that role our duty is to the court, not to the party paying us, and our report must say what we actually think. That is not a limitation, it is the reason the evidence carries any weight at all.
I think my business partner has been taking money. What can you do?+
We examine the financial records and establish what can actually be evidenced, which is not always what is suspected. We quantify it, and we set out what can be proved and what cannot. That distinction is the foundation of whatever your solicitor does next.
Do I need a solicitor as well?+
For anything contested, yes. We handle the financial and valuation work. The legal claim, whether that is an unfair prejudice petition, a partnership dissolution or a breach of contract action, is your solicitor’s. We work alongside them and, if you do not have one, we can suggest firms who do this properly.
We want to settle rather than fight. Can you still help?+
Yes, and most disputes should end that way. An independent, credible valuation that both sides can look at is frequently what makes a settlement possible. Very often the fight is not about principle. It is about the fact that nobody has produced a number anyone believes.
In a dispute, or heading for one?
The earlier the numbers are established, the cheaper the whole thing gets.