Originally from Dispute Resolution Journal

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"Dissension," "oppression," and "deadlock"^ are the popular terms for disputes among participants in the closely held corporation. Breakdown occurs more frequently in close corporations than in other modes of business organization because the participants usually have no easy way out. Any one partner can terminate a partnership at will if he is dissatisfied with the enterprise's course. A dissident shareholder in a widely-held corporation can sell his interest, but there is generally little market for minority shares in a close corporation. Moreover, stock transfer restrictions often prevent a close corporation shareholder from selling, or require him to sell on unfavorable terms. Consequently, when intra-corporate disagreement erupts, the minority shareholder is usually at the mercy of the majority. Even when oppression of the minority interest is not involved, crippling deadlocks can occur if two shareholder or director groups have equal voting power, or if minority shareholders have obtained by agreement a veto over corporate policies.'' A shareholder ordinarily cannot expect judicial relief for dissension, oppression or deadlock because courts are reluctant to scrutinize management and policy disputes which are untainted by fraud or breach of fiduciary duty. Thus, as long as his adversaries remain incalcitrant, the close corporate participant may find himself locked into an insoluble dispute which may involve his life savings and sole source of income.