After a real estate development company (hereinafter referred to as "B Company") is capitalized by Company A, the shareholding structure is as follows:
Company B was originally a sole proprietorship company of Mr. Zhou. In a real estate development project, Company B needed to pay a land payment of 100 million yuan. Mr. Zhou’s cousin Zhao said that his company , A, could cooperate with company B. Therefore, Company B and Company A signed a Capital Increase Agreement, stipulating that: Company A will increase capitals by 120 million yuan to Company B, holding 60% of the shares, and the registered capital of the company will increase to 200 million yuan. Subsequently, both parties handled the procedures for industrial and commercial change registration. The executive director of the company was served by Mrs. Zhou and the general manager was served by Zhao. After Company A became a shareholder, it operated and controlled Company B.
During the project, Company B held a shareholders meeting to make a resolution to introduce a listed company as a sales partner. The real estate project is appointed by the listed company to manage the sales team and use the listed company brand for publicity and sales. At the same time, Company A urged Mr. Zhou to sign a loan agreement of RMB 180 million with the listed company. Mr. Zhou believed that the terms were too harsh and refused to sign. Tensions were high. The two sides disagreed in the direction of the company's development, and they were unable to reach an agreement on the exit of the equity. Therefore, Mr. Zhou and Mrs. Zhou entrusted us with this issue and hoped to regain control of the company.
As of now, 2019, the dispute over the right to know the shareholders' rights was held as scheduled. During the trial, the lawyer of Company A submitted the following evidence:
1.Audit report: The registered capital of Company A that has been fully paid, and Mr. Zhou’s paid contribution is 0;
2.The resolution of the extraordinary shareholders meeting on May 5, 2018: Requires Mr. Zhou to pay all the registered capital before May 25, 2018 and limit the profit distribution request right and the shareholders' right to know before the payment;
3.The resolution of the extraordinary shareholders meeting on June 1, 2018: Requires Mr. Zhou to pay all the registered capital before July 1, 2018 and continue to limit the right to restrict the distribution of profits and the shareholders' right to know before the payment;
4.Resolution of the EGM on August 1, 2018: Resolution on the forfeiture of Mr. Zhou's shares.
Attorneys of Company A tried to prove that Company B had passed the legal procedures and dismissed Mr. Zhou’s shareholder qualifications, and asked to consult Company B’s financial books but to no avail.
After that, Company A appealed to the court according to the evidence above, and requested an order to release Mr. Zhou as a shareholder of Company B. They have also requested that Company B handle the company's capital reduction registration.
(1) The petition requesting the court to disqualify the defendant's shareholders is not based on the claim.
The disqualification of shareholders shall be in the form of a resolution of the shareholders' meeting, and the matter shall not fall within the scope of the people's court.
Article 17 of the Judicial Interpretation of the Company Law (3) allows shareholders to sue the resolution when there is an objection to the resolution of the shareholder's delisting. There is no power given to any subject to dismiss the shareholder's qualifications through litigation.
The dismissal of shareholder qualifications is a matter within the scope of corporate autonomy, and is not within the scope of adjustment of civil cases in courts. The people's courts in practice cases hold this view. (Reference case: (2019) 閩 0504, No. 408, No. 408, (2017) Lu 0703, No. 1703, No. 1703)
(2) There is no factual basis and basis of claim for requesting the court to order the reduction of capital and change of registration.
Article 43 of the "Company Law" stipulates: "The method of discussion and voting procedures of the shareholders' meeting shall be stipulated by the company's articles of association, except as provided in this Law."
The "Articles of Association" of the Company B stipulates that "all matters such as capital reduction must be approved by all shareholders." Therefore, the petition requesting the company to apply for capital reduction should be approved by all shareholders and a resolution of the shareholders meeting.
In this case, Company A only has 60% of the voting rights of the company, and two-thirds of them are still insufficient, which cannot meet the conditions for unanimous approval.