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. ​

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