Research On Relief System Of Shareholder Resolution Defects

Shareholder resolution defect refers to the defects which lack substantive elements of a shareholder resolution. For a long time, shareholders resolution defects are based on an assumption that lack of an effective element will harm the interests of shareholders. Because of this assumption, it's necessary to take some kind of intervention by the judicial to correct resolution defect of the shareholders. In this way, it provides better access for better management of the company and protection for the investors. Article 22 of Company Law provides a brief review for the resolution defect of the shareholders. After that Judicial Interpretation No.4 has conducted a number of detailed provisions. By March 20, 2015, the shareholder resolution defect cases reached 533, of which 134 cases are concluded in 2014 and it accounts for 24.6% of the total number. Among the 134 cases, there are 54 first instance cases and 68 second instance cases which account for 50.7% of the total number. Judicial practice forces the resolution relief system to be perfect.After analysis of the judicial case from 2007 to 2015, I provide some legal advice for the perfect of the relief system of shareholder resolution defects. First, it needs to set constitution standard for revocable cases. It should use the relevance theory to restrict the casual link between the withdrawal and the injured right to prevent frivolous lawsuits by avoidance behavior. Second, it needs to establish non-litigation relief system, introducing defects cured, withdrawn, ratify and exemption system. And to recognize the establishment of reconciliation mechanisms between the original defendants under certain conditions is also necessary. Third, make the effectiveness of judgment clear seeking balance between the unity of the effectiveness and the protection of bone fide third parties. Fourth, improve the security system, such as clear proof of liability, guarantee proposed time, limit considerations, exemptions and determine the amount of security. Fifth, improve the system of discretionary dismissal, and notes the applicable conditions of discretion to be rejected, which is only applied to violations of voting procedures and the violations should be pretty small.