Just and Equitable Winding Up: Understanding Your Options

Just and equitable winding up is one of the most serious remedies available to shareholders when a company relationship has broken down beyond repair. Our solicitors advise directors, shareholders and business owners on whether the grounds exist, what the process involves, and whether a better outcome is achievable.

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shareholder dispute solicitors manchester

A Remedy of Last Resort That Carries Real Weight

Petitioning to wind up a company on just and equitable grounds is not a step to take lightly. Once a petition is presented, it becomes a matter of public record and can damage relationships with banks, suppliers and clients before a court hearing has even taken place. Our solicitors work with shareholders and directors across Manchester and throughout the UK, advising on whether the grounds for just and equitable winding up genuinely exist and, where they do, whether a negotiated exit, a buyout or a deadlock resolution mechanism might achieve a better result with less disruption.

How Our Winding Up Solicitors Help Shareholders and Directors

From assessing whether grounds exist to advising on alternatives, we handle every stage of the just and equitable winding up process.

Assessing the Grounds

Not every breakdown in a shareholder relationship justifies a just and equitable petition. Our solicitors review the factual and legal position to advise whether the grounds genuinely exist, including loss of substratum, deadlock, exclusion from management and breakdown of mutual trust.

Advising on Alternatives

Winding up on just and equitable grounds should be considered alongside other available remedies. We advise on unfair prejudice petitions, negotiated share buyouts, shareholder mediation and deadlock resolution mechanisms before a petition is filed.

Shareholder Deadlock

Where a 50/50 split has brought the company to a standstill and no deadlock resolution clause exists, just and equitable winding up may be the only route to break the impasse. Our solicitors advise on whether this threshold has been reached and what the court is likely to do.

Petition Preparation and Support

Where winding up on just and equitable grounds is the right course, our solicitors prepare the supporting documentation and advise at each stage of the process. Where court representation is required, we work alongside appropriately regulated professionals.

Responding to a Petition

If a petition has been presented against a company you are involved in, acting quickly matters. We advise directors and shareholders on the options available to oppose, negotiate or resolve the petition before a winding up order is made.

Not sure where to start?

Speak to our solicitors about your situation and we will point you in the right direction.

What This Means for You

  • Honest advice on whether grounds for winding up exist
  • Alternatives explored before any petition is filed
  • Protection of your position if a petition is presented against you
  • A clear picture of what the process involves and how long it takes
  • Documentation and support handled at every stage

When To Seek Advice

  • The company has reached a complete deadlock, and no resolution mechanism exists
  • You are being excluded from management in a way that cannot be resolved through negotiation
  • The company’s original purpose has fundamentally changed without your agreement
  • Mutual trust between shareholders has broken down to the point where the relationship cannot continue
  • A compulsory winding up petition has been presented, and you need to understand your options
  • You want to explore whether just and equitable winding up is the right remedy before taking any action

Meet the Founder

Marium brings 22 years of experience advising businesses and shareholders on just and equitable winding up petitions, shareholder disputes and company dissolution across the UK and internationally. A Solicitor regulated by the SRA (ID: 277854), MCIArb, and registered mediator in the DIFC Courts, she has advised on complex winding up petitions, shareholder deadlock and breakdown of trust between company members for clients ranging from owner-managed businesses to established companies.

Marium Razzaq - Solicitors in Manchester
Marium Razzaq
Solicitor & Director Mar Legal
MCIArb

Why Shareholders Choose MAR Legal for Winding Up Advice

Solicitor Led Advice

Every matter is handled by our solicitors.

Fast Response

We respond without delay and prepare your position at pace.

Fixed Fee Pricing

Clear fee structures from the outset so you know the cost of advice before you commit.

Commercial Focus

Our solicitors focus on the outcome that protects your interests, not just the legal process.

Trusted by shareholders and directors across the UK for clear, commercial advice on just and equitable winding up and shareholder dispute resolution.

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How Our Just and Equitable Winding Up Process Works

01

Position Review

We review the shareholding structure, the company articles, any shareholders agreement and the factual background to advise on whether the grounds for just and equitable winding up are met.

02

Alternatives Assessment

Before any petition is filed, we set out the alternative remedies available, including unfair prejudice claims, negotiated buyouts and deadlock resolution, with a clear view of what each is likely to achieve.

03

Petition or Resolution

Where winding up is the right course, we prepare the supporting documentation and manage the process. Where an alternative route is preferable, we handle the negotiation and documentation to reach a binding outcome.

04

Completion

Once the matter is resolved, whether through a winding up order, a share purchase or a negotiated settlement, we handle the documentation required to formally conclude the position.

What Our Clients Say

Just and Equitable Winding Up FAQs

Just and equitable winding up is a statutory remedy under section 122(1)(g) of the Insolvency Act 1986, allowing a court to wind up a solvent company where it is fair and equitable to do so. It is most commonly used where there has been a complete breakdown of trust between shareholders, a deadlock that cannot be broken, exclusion from management, or where the company’s original purpose no longer exists. It is a remedy of last resort, and the courts will consider whether any other remedy is more appropriate before making a winding up order.

The courts have recognised several established grounds, including deadlock between shareholders where the articles provide no mechanism for resolution, loss of substratum where the company’s main purpose can no longer be carried out, exclusion of a shareholder from management in circumstances where they had a legitimate expectation of involvement, and a complete breakdown of mutual trust and confidence. The list is not closed, and the courts have discretion to wind up a company where the circumstances make it just and equitable to do so.

They are separate remedies available under different statutes, though the factual circumstances giving rise to each often overlap. An unfair prejudice petition under section 994 of the Companies Act 2006 is usually preferred where the company is solvent, and the petitioner wants a buyout or a change in conduct rather than winding up. Just and equitable winding up tends to be used where the relationship has broken down so completely that no remedy short of dissolving the company will work, or where an unfair prejudice petition is not available on the facts.

Compulsory winding up is most commonly used where a company cannot pay its debts and a creditor petitions for a winding up order. Just and equitable winding up is a shareholder remedy used where a company may be solvent but the relationship between its members has broken down. The process is similar in that both involve a petition to the court, but the grounds, the parties and the purpose of the remedy are different.

Yes. A petition can be withdrawn if the parties reach a settlement before a winding up order is made. The court also has discretion to dismiss a petition if an alternative remedy is available and the petitioner is acting unreasonably in not pursuing it. Negotiated buyouts, mediated settlements and unfair prejudice claims are all routes that can be explored after a petition has been presented. Acting quickly after a petition is filed significantly improves the prospects of reaching a resolution without a winding up order being made.

From filing a petition to a winding up order, the process typically takes between six and twelve months, though it can take longer in contested cases. The petition must be advertised in the London Gazette, which triggers a seven-day period during which creditors and other parties can apply to the court. If the matter is contested or if the company applies to stay the petition, the timeline extends further. Reaching a negotiated settlement before the hearing is almost always faster and less disruptive.

Once a winding up order is made, a liquidator is appointed to realise the company’s assets, pay its creditors and distribute any surplus to shareholders in proportion to their shareholdings. If the company is solvent, shareholders will receive a return on their shares, though the amount depends on the value of the assets after all liabilities are settled. The winding up process brings the company to an end and it is removed from the register at Companies House once the liquidation is complete.

MAR Legal provides advisory and documentation support in connection with just and equitable winding up and does not conduct litigation or represent parties in court or insolvency proceedings. Where a matter involves reserved legal activities or requires regulated representation, we work alongside appropriately regulated professionals.