Kerala High Court says most company law cases are actually family disputes masked as corporate issues. Court suggests mediation as a better solution in such matters.
Kochi: Today, on July 18, the Kerala High Court, while hearing a company law matter, noted that many corporate legal disputes in India are actually family disputes in disguise.
The observation came from a Division Bench of Chief Justice Nitin Jamdar and Justice Harisankar V Menon during the hearing of a company appeal in the case.
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The case, which dates back to a 2007 appeal, stemmed from a disagreement among siblings over a will executed by their father in 1986. As the Court delved into the matter, it became apparent that the dispute, although framed under company law, was primarily rooted in personal and familial issues.
During the proceedings, Chief Justice Nitin Jamdar orally remarked,
“Unfortunately most of our company law matters are nothing but family disputes in corporate gloss. Most of the companies are family owned companies. Underneath it all, these are family disputes.”
This candid observation highlights how the Indian corporate landscape, particularly in closely-held or family-run companies, often gives rise to legal battles that are essentially internal family conflicts presented as company matters.
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Recognising the nature of the case and the relationships between the parties, the Court suggested that the matter should be resolved through mediation.
With the agreement of all the lawyers representing the parties, the Bench directed them to propose names of mediators who could help in settling the issue outside the formal court process.
When it was brought to the Court’s attention that the parties involved in the dispute were now elderly, the Bench expressed understanding and made a considerate direction.
It allowed the litigants to attend mediation through video conferencing or, if necessary, to be represented by a suitable person. This move was intended to ease the burden on the senior citizens involved and ensure that the mediation process remains accessible.
In addition, Chief Justice Jamdar made another insightful remark, expressing hope that the issue might be better resolved by the next generation.
He stated,
“Our experience in these matters is that the younger generation resolves it much better.”
This reflects the judiciary’s broader view that younger heirs are often more open to amicable settlement, rather than letting family discord escalate into prolonged litigation.
Case Title:
S Ramakrishna Sarma & Ors. v. Company Law Board, Southern Region Bench & Ors.
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