Pathology of Non-Financial Disputes Among Partners in Private Joint Stock Companies: Innovative Judicial Protection Strategies

Abstract

Private joint stock companies in Iran, as one of the most common forms of business entities, often face challenges such as the violation of shareholders’ and partners’ financial rights, particularly those of minority shareholders. These issues primarily arise due to decision-making systems based on majority voting. This study seeks to identify the causes of these non-financial disputes and propose new judicial solutions to protect the rights of shareholders and partners. Using a descriptive–analytical approach and combining library and field research methods, the study explores the legal, social, and managerial causes underlying these conflicts. The findings indicate that factors such as shareholders’ and partners’ lack of legal awareness, deficiencies in the company’s articles of association, misuse of majority power, and absence of impartial managers constitute the main sources of such problems. The study proposes innovative measures such as strengthening the derivative suit system, applying the Islamic jurisprudential principle of La Zarar (“no harm”), and invoking constitutional and civil law provisions (such as Articles 328 and 331 of the Civil Code) to safeguard the rights of minority partners. These approaches emphasize the judiciary’s role in preventing rights violations and aim to establish a balance between majority rule and corporate justice. Ultimately, the research underscores the necessity of reforming relevant laws, developing stronger protective regulations, and enhancing partners’ awareness of their rights and obligations. Such efforts can serve as a legal policy guideline and help reduce litigation in private joint stock companies.