Usually the constitution of a company does not deal completely with many operational issues and these can be contained in a separate shareholder’s agreement. Both documents can be complex as they often provide for different rights and obligations and these have to be looked at in the context of the Corporations Act.
You need to be very careful in drafting shareholder’s agreement and only do so with an eye to the future because relationships between parties do change over time. Once rights and obligations are set out in a shareholder’s agreement they can very difficult to unwind so a lot of care needs to be taken when it is drawn up.
Sometimes individuals work together in their own names rather than through a company and in this case the Partnership Act may apply as well as any partnership agreement which is entered into between the parties. Again these can be complex documents and must be read in the context of the Partnership Act so a great deal of care needs to be taken in drawing it up.
Shareholder and partnership disputes can be very expensive so you should contact our Corporate Law team to get advice at the beginning before problems occur.
If you would like more information about our services in this area, please call us today.