Welcome our new articled student, Noah Faust-Robinson!

AMLC is pleased to welcome Noah Faust-Robinson back to the team as an articling student.

Noah completed his summer articles at AMLC before graduating from the University of Victoria this spring. We are excited to have him rejoin the team.

Welcome back to the team, Noah!

AMLC Hosted a 2L Summer Student Firm Tour

This week, AMLC hosted a summer firm tour in collaboration with the University of Victoria Faculty of Law. We were happy to welcome the students into our office and give them a behind-the-scenes look at what we do. Thanks to everyone who attended. We look forward to meeting you again during interviews this fall! 

AMLC Legal Insights: Two’s a Crowd – court ordered shotgun sales in closely held companies

By Bryan Hicks & Molly Robson (articling student)

In a recent decision, the Supreme Court of British Columbia resolved an impasse between the co-founders and sole shareholders/directors of a currency exchange business by ordering one shareholder to present a “shotgun” offer to purchase the other owner’s shares. It will then be up to the recipient to either accept the offer or turn things around by buying the offeror’s shares for the same price. Either way, one of the shareholders will be bought out leaving the other as the sole owner and director going forward.

Shotgun sales are a useful remedy in closely held companies where the shareholders are stuck in a deadlock and the court is asked to step in. However, the specific structure of a shotgun sale should be tailored to the circumstances of each case. This case is a helpful reminder that shareholders should give careful consideration to how they should structure their shotgun offer to increase the likelihood of getting to the desired outcome.

Emadi v. Soleymani, 2025 BCSC 1178

Pouria Emadi and Reza Soleymani launched VanEx Currency Exchange Inc. (“VanEx”) in 2019. The business operated for several years without major issues, and revenues continued to grow. As of 2023, VanEx had eleven employees and annual revenues of approximately $1.7 million. Mr. Emadi serves as the Company’s President and has managed the business since its founding. Mr. Soleymani has not been directly involved in the Company’s day-to-day affairs.

The relationship between the co-founders started to deteriorate in about May 2024, eventually putting  VanEx in a deadlock. It became apparent to both parties that they could no longer work together and VanEx could not survive the impasse.

Mr. Emadi applied to the Court for a just and equitable winding up of VanEx under section 214 of the Canada Business Corporations Act (the “Act”). Both parties agreed this was an appropriate case for the Court to use its jurisdiction to address the deadlock, but rather than liquidating and dissolving VanEx, the Court should exercise discretion under section 241 of the Act to order that one shareholder buyout the other by way of shotgun purchase.

However, the parties could not agree on various details such as which of them should be required to make the offer, whether the offer should be structured as an offer to purchase or to sell, whether the offer should be for the Company’s assets rather than its shares, and how outstanding shareholder loans owed by VanEx to each of the shareholders should be addressed as part of a shotgun purchase.

The court hearing proceeded in a rushed manner and there was insufficient time to canvass all of the issues raised. Rather than schedule additional hearing time, the Court asked each party to file written arguments for the Court to consider when formulating a resolution to the corporate deadlock.

The Court ultimately ordered that Mr. Emadi is required to make an offer for the purchase of Mr. Soleymani’s shares within 21 days of receipt of certain information from Mr. Soleymani, and the offer must also provide for the repayment of Mr. Soleymani’s shareholder loan. Mr. Soleymani will then have 21 days to accept the offer, failing which he will be required to purchase Mr. Emadi’s shares and provide for the repayment of Mr. Emadi’s shareholder loan on the same terms as Mr. Emadi’s offer.

The Court placed considerable weight on the fact that Mr. Emadi was better positioned to value the Company and run it going forward when structuring the shotgun as an offer to be made by Mr. Emadi for the purchase of Mr. Soleymani’s shares. The Court rejected Mr. Soleymani’s suggestion of an asset purchase rather than a share transaction since it would have been more complicated, less certain, and more likely to result in further disputes.

Takeaways

Shareholders in closely held companies sometimes have a falling-out.  When that happens, it might be appropriate to seek a buyout of one or more shareholders. However, it is important to consider how such offers should be structured. Various factors are often relevant including who is in the best position to run the business going forward, whether one of the parties lacks the resources to complete a purchase, and how to approach the issue of valuation.

Courts have broad discretion to formulate a forced buyout in circumstances where a closely held company is stuck in a deadlock, whether by shotgun sale or with the involvement of a business valuator. Importantly, the court is not required to first make a finding of wrongdoing in deadlock scenarios if it can be shown that the most appropriate solution is for one party to exit the company.

Experienced legal counsel can help navigate these delicate situations and formulate a strategy for achieving a favourable outcome.

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AMLC Legal Insights are intended for informational purposes only and do not constitute legal advice or opinion.

AMLC Legal Insights: Family Feud - navigating disputes over family businesses

By Bryan Hicks and Jorie Les

The Supreme Court of British Columbia recently released its latest decision in a decades-long dispute among four brothers over the ownership and control of a valuable family business founded by their late father in the 1950s.​

​In Callahan v. Callahan, 2025 BCSC 1107, the Court largely dismissed an application supported by three of the brothers—Robert, Bruce, and Douglas—and two related entities to strike or dismiss the claims brought against them by their brother Edward.  The claims relate to lands in Kelowna, British Columbia owned by a company in which the four brothers are equal shareholders.  

Background​

​Lloyd Callahan first established a trucking business in the 1950s.  He later expanded into construction and real estate.  The business continued to grow over time.  An earlier court decision noted that the total assets exceeded $300 million as of the early 2000s.  Each of the four brothers had been involved in the family business since they were teenagers.  Edward became more prominently involved starting in the 1980s at his father’s request.  He later became the general manager of the Callahan group of companies and ran the business for more than 20 years.​

​The underlying dispute among the four brothers appears to have escalated in about 2002, around the time of their mother’s passing. Since then, the brothers have been embroiled in numerous legal proceedings, including a protracted mediation/arbitration lasting 14 years, oppression proceedings under s. 227 of the BC Business Corporations Act (the “Act”), proposed wind-up ​proceedings under s. 324 of the Act, a derivative action under s. 232 of the Act, and various civil actions.​

​The Kelowna lands at issue in the current lawsuit have already been approved for sale as part of a liquidation initiated by Robert, Bruce, and Douglas who control the company that owns the lands.  The purchaser (another company controlled by Robert, Bruce, and Douglas) will pay the purchase price to the liquidator to be held pending the outcome of trial or other order of the Court. ​

​If successful, this application would have brought the multi-faceted dispute one step closer to an end. Instead, the action appears headed for trial, where the brothers will have to testify against each other in order for the Court to determine their rightful “pieces of the pie” concerning the Kelowna lands. Perhaps then the four brothers will be able to find some peace, or at least re-purpose the considerable time and money they have spent on this protracted litigation.​

​Takeaways​

​Disagreements over a family business are unfortunately not uncommon.  Disputes over the direction of a family business, who should make decisions, and to what extent part of the business should be sold to “cash out” are sometimes not far below the surface. Often such disputes boil over when control passes from one generation to the next, and in some instances, these disputes can also involve estate litigation components when triggered by the loss of a family member.​

​In such circumstances, experienced counsel can ​guide you in taking the necessary legal steps to protect your interest in a family business, or to protect the business itself. Indeed, there are various options both at common law and under the Business Corporations Act to resolve disputes over ownership and control, such as:​

• a buy-out of one or more shareholders (by another shareholder or the company)​

• the removal/replacement of one or more directors​

• the appointment of an independent director to break a deadlock​

• a court order to prevent or require a specific action​

• a court order requiring the disclosure of financial or other information​

• a sale of part or all of the business​

• a division/separation of business assets among family members​

• a lawsuit by the business against one or more individuals who are misusing business assets​

• claims brought on behalf of an estate to clarify ownership of certain assets​

Protecting the family business is indeed serious business that can have multi-generational implications.  It is therefore important to give careful consideration as to the desired outcome, and implement an effective strategy to achieve that outcome, with the assistance of the courts if necessary. ​

Download a PDF copy of AMLC Legal Insights

AMLC Legal Insights are intended for informational purposes only and do not constitute legal advice or opinion.

AMLC is a proud Standing Ovation Sponsor of The 2025 Lawyer Show taking place from May 28-31.

This year’s production is of The Addams Family Musical and tickets are available to purchase at https://touchstonetheatre.com/2025-lawyer-show.

The Lawyer Show is an annual fundraising event for Touchstone Theatre, a registered charitable organisation and non-profit society. Every year, an ensemble of talented lawyers take centre stage for four days to raise funds to support the production of works from Canadian theatre artists, and ancillary programs for emerging under-represented playwrights.

Greg Allen and Danielle Wierenga successfully defend personal injury appeal

The British Columbia Court of Appeal has found in favour of the respondent plaintiff in a personal injury case involving two motor vehicle accidents. The plaintiff was represented in this appeal by Greg Allen and Danielle Wierenga, who succeeded in thwarting the appellants’ attempt to challenge the quantum of damages assessed by the trial judge.

At trial, the Court awarded the plaintiff general damages, damages for past and future lost income earning capacity from employment and property development, and damages for cost of future care. On appeal, the appellants argued that Justice Macintosh had misapprehended a concession made by counsel in closing submissions and further erred in the assessment and calculation of damages for loss of past and future earning capacity.

The Court of Appeal dismissed both grounds of appeal. It held that although the trial judge may have erred in misunderstanding an amount conceded by counsel with respect to a particular component of damages, an error which would be considered “obvious” or “palpable,” in the circumstances, it was not “overriding” such that it warranted interference on appeal. The alleged errors with respect to assessing damages for loss of earning capacity were also dismissed, with the Court of Appeal finding that the quantum assessed was consistent with the trial judge’s factual findings and evidence adduced at trial.