Company Impasse And Its Relief

This article focuses on the deadlock question in the close corporation. The deadlock results in the unique conflict between the designing of corporate governance based on the majority-capital-devide principle and the enclosure characteristic of the close corporation. It is reflected by those phenomena: one party of shareholders or directors who own equity right or power with the others can't compromise, then the meetings of shareholders or directors can't be held because of the absence of the other party, so any resolution can't be made, finally the governance of corporate is paralyzed, the assets of the company lose, the business of the company is destroyed, the legal right and benefit is deeply hurt.Nowadays there are plenty of researching results and related experience as to the deadlock in other countries. But we still do not get start to research, and our legal experience is far behind those of the developed countries. The purpose of the article is to enrich the researching works and provide a train of thoughts for judges to deal with those deadlocks. Whereas this article make a deep research on the deadlock issue by a logical, rule-study and comparing means.In this article the author gives some examples of deadlock in the reality as a beginning. Then he discusses the concept, characteristics, type, harm of deadlock. After analyzing the inner and outer reasons of the deadlock, he believes that the jurisprudent base for dissolving the deadlock is to make shareholders under the obligations of trust like that between partners, and the reasonable expected benefit on finance and/or management for minority shareholders shall be protected by the law. When the structural or distributive rules do not work to protect those benefit said above, the judges shall fix the hole in the law by introducing the fiduciary rules. On condition that the judge believe the minority shareholders own reasonable expected benefit on finance and/or management, those benefit of the plaintiff shareholders shall not be ignored.The author makes some imagination for the designing the system of the...