LLP disputes

partner disputes - whistleblowing

£3.4m LLP member whistleblowing claim permitted to proceed

ByPeter Garry

Losses resulting from expulsion following whistleblowing can be very substantial, and there is no statutory limit on the amount of compensation that can be awarded.

But in some cases the expulsion of the whistleblower may:

  • be based (at least on the face of the expulsion documentation) not on the whistleblowing, but on different, lawful grounds, or
  • be achieved by way of resolution of the other members under the terms of the LLP deed, under provisions requiring no grounds to be stated.

In such circumstances it may be argued by the continuing LLP members that the chain of causation between the whistleblowing and the whistleblower’s loss brought about by the expulsion of the whistleblower has been broken, and that accordingly no recoverable loss arises.

The Court of Appeal decision earlier this year in Wilsons Solicitors & others v Roberts brings such scenarios sharply back into focus.

Derivative claims
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The advantages of derivative claims over unfair prejudice petitions

ByPeter Garry

An LLP member or company shareholder:

  • who is in the minority and thus outvoted, and
  • whose co-proprietors have misused or misappropriated business assets (including the misdirection of corporate opportunities),

may in some circumstances be able to pursue a claim against his co-proprietors on behalf of the LLP or company (even though the LLP or company is otherwise controlled by the misbehaving majority), in order to seize back the assets and/or to recover compensation for the LLP or company. Furthermore the LLP or company might well be ordered, at the outset of the claim, and throughout the conduct of the claim, to pay most of the member/shareholder’s legal costs incurred in bringing the claim.

Predator partner

The evolution of the partnership and the predator partner

ByPeter Garry

(This article was first published on the Kluwer Mediation Blog on 7 March 2017)

…the typical all-powerful and largely irreplaceable partner of yore has evolved to become a powerless, placeholder partner, keeping the chair warm for the next incumbent of his post. He is the counterpoint to, and the prey of, the predator partner.

This has radically altered how many partnership disputes, especially in the professions, tend to arise and are resolved.

Is member liability in Limited Liability Partnerships really limited?

Is member liability in Limited Liability Partnerships really limited?

ByPeter Garry

There are many circumstances in which an LLP member can end up with personal liability for either individual liabilities of the LLP or a share of the LLP’s losses over a particular period. This article examines just a couple of related examples as to how LLP members can end up bearing very substantial LLP losses….

van Winkelhof, Court of Appeal

Winkelhof whistleblower equity partner is not a “worker” after all, but can bring a discrimination claim in England

ByPeter Garry

“… such a member cannot bring a whistleblowing claim (and would also be deprived of part-timer and equal pay remedies) …” In a previous post I commented on the case of Bates van Winkelhof v Clyde & Co in which the Employment Appeal Tribunal found that an LLP member was a “worker” within the meaning…