Legal Research On Corporation Deadlock And The Remedy Measures

This paper focuses on the issue of the corporation deadlock, which mainly exits in limited liability corporation, and is a unique problem emerging from the encounter between modern enterprise system based on three basic principles of corporation capital and capital determinism and enclosure of limited liability company. The appearance of corporation deadlock makes the normal operational state of the corporation at a standstill, even risks paresis. Once the corporate deadlock forms, it will harm much the interests of shareholders, corporation, creditors and the employees, even the social harmony and stability. Therefore, it is a realistic topic of corporation law to study the reasons of corporate deadlock formation, and seek the right solutions.Starting with the concept of corporate deadlock, this paper combines the viewpoints of scholars at and out of home with the actual situation of our own country to analyze the reasons of corporate deadlock formation, and put forward the solutions.Apparently analyzing, the deadlock derives from the dissents and oppositions between shareholders or directors, but the deep-rooted reason is the unique organization of liability limited corporation and system of corporation law.Our limited liability corporation is relatively easy to slide into deadlock due to its trust among shareholders, and enclosure. In addition, the basic system of the corporation has something to do with and leads to the corporate deadlock, including systems of capital and vote. The theory foundation of breaking the deadlock can be easily found in theories of credit obligation, corporate contract, corporate social responsibility and etc.Self remedy measure is an important composition of corporate remedy measures, and the shareholders can regulate the treatment methods in the articles of corporation to prevent the occurrence of corporate deadlock, or take measures of restricting vote rights, and bring into a neural party to do the mediation to try to break the deadlock. When all these measures do not work, the Judicial measures should be brought to solve it, which is an inevitable tendency in current judicial measures improvement and rectification as well as an important measures for the corporation to deal with deadlock, and the judicial measures includes judicial dissolution, coercive purchase of shares and others.In the 138th clause of the newly-revised Corporation Law, the court is given the power of dissolving the corporations. However, it is too abstract and general, does not give any supporting implementation except for one relief measure of deadlock, and is not feasible. Therefore, this paper adheres to the actual situation of our country, draws on the western experience, and analyzes the application of the 138th clause and other alternative judicial measures to-be-adopted by the court in our country.