Dispute resolution in family companies

John Farrar, Susan Watson, Laurence Boulle

Research output: Contribution to journalArticleResearchpeer-review

Abstract

The Bubble Act of 1720 made corporate charters relatively difficult to obtain. As a response to the Bubble Act and prior to the general right to incorporation by registration in the mid-Nineteenth Century, an early form of unincorporated company developed in the United Kingdom. The deeds of settlement creating the unincorporated companies almost always contained dispute resolution clauses. Once incorporation by registration became possible, the internal governance of companies was determined by articles of association. UK companies were permitted to draft their own articles or to adopt provisions found in the schedules to the Acts. Dispute resolution clauses were not included but arbitration clauses were nevertheless often included in articles of association for companies for a period from the late Nineteenth Century onwards in the articles of smaller private companies that developed at that time. The demise of the adoption of the provisions coincided with questions about their enforceability. Even though those enforceability issues probably no longer exist, dispute resolution clauses are rarely found in the constitutions of modern companies.This article examines and critiques the legal framework around dispute resolution in family-owned companies and argues for the inclusion of dispute resolution clauses in some form in constitutions of companies. The article contains two simple empirical surveys that show that the failure to include dispute resolution clauses in constitutions and the absence of other dispute resolution mechanisms for family companies leaves the courts as the only recourse for resolution of disputes.
Original languageEnglish
Article number0122-0581
Pages (from-to)155-186
Number of pages32
JournalCanterbury Law Review
Volume18
Publication statusPublished - 2012

Fingerprint

constitution
act
nineteenth century
arbitration
recourse
charter
inclusion
governance
time

Cite this

Farrar, J., Watson, S., & Boulle, L. (2012). Dispute resolution in family companies. Canterbury Law Review, 18, 155-186. [0122-0581].
Farrar, John ; Watson, Susan ; Boulle, Laurence. / Dispute resolution in family companies. In: Canterbury Law Review. 2012 ; Vol. 18. pp. 155-186.
@article{a7a447af2ddd47349d70ee14592d6c9d,
title = "Dispute resolution in family companies",
abstract = "The Bubble Act of 1720 made corporate charters relatively difficult to obtain. As a response to the Bubble Act and prior to the general right to incorporation by registration in the mid-Nineteenth Century, an early form of unincorporated company developed in the United Kingdom. The deeds of settlement creating the unincorporated companies almost always contained dispute resolution clauses. Once incorporation by registration became possible, the internal governance of companies was determined by articles of association. UK companies were permitted to draft their own articles or to adopt provisions found in the schedules to the Acts. Dispute resolution clauses were not included but arbitration clauses were nevertheless often included in articles of association for companies for a period from the late Nineteenth Century onwards in the articles of smaller private companies that developed at that time. The demise of the adoption of the provisions coincided with questions about their enforceability. Even though those enforceability issues probably no longer exist, dispute resolution clauses are rarely found in the constitutions of modern companies.This article examines and critiques the legal framework around dispute resolution in family-owned companies and argues for the inclusion of dispute resolution clauses in some form in constitutions of companies. The article contains two simple empirical surveys that show that the failure to include dispute resolution clauses in constitutions and the absence of other dispute resolution mechanisms for family companies leaves the courts as the only recourse for resolution of disputes.",
author = "John Farrar and Susan Watson and Laurence Boulle",
year = "2012",
language = "English",
volume = "18",
pages = "155--186",
journal = "The Canterbury Law Review",
issn = "0112-0581",

}

Farrar, J, Watson, S & Boulle, L 2012, 'Dispute resolution in family companies' Canterbury Law Review, vol. 18, 0122-0581, pp. 155-186.

Dispute resolution in family companies. / Farrar, John; Watson, Susan; Boulle, Laurence.

In: Canterbury Law Review, Vol. 18, 0122-0581, 2012, p. 155-186.

Research output: Contribution to journalArticleResearchpeer-review

TY - JOUR

T1 - Dispute resolution in family companies

AU - Farrar, John

AU - Watson, Susan

AU - Boulle, Laurence

PY - 2012

Y1 - 2012

N2 - The Bubble Act of 1720 made corporate charters relatively difficult to obtain. As a response to the Bubble Act and prior to the general right to incorporation by registration in the mid-Nineteenth Century, an early form of unincorporated company developed in the United Kingdom. The deeds of settlement creating the unincorporated companies almost always contained dispute resolution clauses. Once incorporation by registration became possible, the internal governance of companies was determined by articles of association. UK companies were permitted to draft their own articles or to adopt provisions found in the schedules to the Acts. Dispute resolution clauses were not included but arbitration clauses were nevertheless often included in articles of association for companies for a period from the late Nineteenth Century onwards in the articles of smaller private companies that developed at that time. The demise of the adoption of the provisions coincided with questions about their enforceability. Even though those enforceability issues probably no longer exist, dispute resolution clauses are rarely found in the constitutions of modern companies.This article examines and critiques the legal framework around dispute resolution in family-owned companies and argues for the inclusion of dispute resolution clauses in some form in constitutions of companies. The article contains two simple empirical surveys that show that the failure to include dispute resolution clauses in constitutions and the absence of other dispute resolution mechanisms for family companies leaves the courts as the only recourse for resolution of disputes.

AB - The Bubble Act of 1720 made corporate charters relatively difficult to obtain. As a response to the Bubble Act and prior to the general right to incorporation by registration in the mid-Nineteenth Century, an early form of unincorporated company developed in the United Kingdom. The deeds of settlement creating the unincorporated companies almost always contained dispute resolution clauses. Once incorporation by registration became possible, the internal governance of companies was determined by articles of association. UK companies were permitted to draft their own articles or to adopt provisions found in the schedules to the Acts. Dispute resolution clauses were not included but arbitration clauses were nevertheless often included in articles of association for companies for a period from the late Nineteenth Century onwards in the articles of smaller private companies that developed at that time. The demise of the adoption of the provisions coincided with questions about their enforceability. Even though those enforceability issues probably no longer exist, dispute resolution clauses are rarely found in the constitutions of modern companies.This article examines and critiques the legal framework around dispute resolution in family-owned companies and argues for the inclusion of dispute resolution clauses in some form in constitutions of companies. The article contains two simple empirical surveys that show that the failure to include dispute resolution clauses in constitutions and the absence of other dispute resolution mechanisms for family companies leaves the courts as the only recourse for resolution of disputes.

M3 - Article

VL - 18

SP - 155

EP - 186

JO - The Canterbury Law Review

JF - The Canterbury Law Review

SN - 0112-0581

M1 - 0122-0581

ER -

Farrar J, Watson S, Boulle L. Dispute resolution in family companies. Canterbury Law Review. 2012;18:155-186. 0122-0581.