Deadlock in a 50/50 company: resolutions of the remaining director void
On 4 November 2026, the District Court of Gelderland published a judgment of 28 October 2026 on a deadlocked 50/50 private limited company. Two directors each held half of the shares through their own companies. After years of disagreement, one of them stepped down as director.
What happened?
The remaining director then decided on his own that the company would be wound up, that each was free to take on their own work and that he would receive € 95 per hour for the winding-up. The other shareholder sought a declaration that those resolutions were void.
Three resolutions void
The company acknowledged that the resolutions on discontinuation and remuneration should have been submitted to the general meeting. The same applied to the resolution on own business opportunities, because of a conflict of interest (Article 2:239(6) of the Dutch Civil Code). All three resolutions are therefore void (Article 2:14 of the Dutch Civil Code). According to the court, the interest in that declaration seems very small, as the deadlock remains. But a possible prelude to director liability proceedings is an interest to be respected.
No order, but information
There is no order to reverse the resolutions: management determines the policy, not a 50 percent shareholder. The company must, however, disclose, among other things, which hours the remaining director has invoiced and which clients he now serves outside the company.
Practical tips
Even in a deadlock, what belongs to the general meeting is not for the board to decide alone.
In case of a conflict of interest, submit the resolution to the proper body; otherwise the resolution is vulnerable and liability looms.
Include a deadlock mechanism in the articles or a shareholders' agreement, so that a 50/50 split does not lead to standstill.
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This blog provides general information and is not legal advice. For advice on a specific situation, please contact us.
