What Is Shareholder Oppression—and What Does It Look Like? 

• 
  Mike Bronsveld
  Lawyer
• 
  Meagan MacArthur
  Student

Shareholder oppression happens when a company—or the people running it—treat one or more shareholders unfairly. This can mean ignoring their interests, shutting them out of decisions, or acting in ways that are unjust, prejudicial, or simply abusive. But what does that actually look like in real life? 

The answer: it depends. Every case is unique, and courts will look closely at the relationships involved and what each party reasonably expected when they became part of the business. What’s considered oppressive in one scenario might be perfectly acceptable in another. 

How Do You Prove Oppression? 

To successfully claim shareholder oppression, courts typically ask two key questions: 

1. Was the shareholder’s expectation reasonable, based on their role and relationship within the company? 

2. Was that expectation violated in a way that qualifies as oppressive, unfairly prejudicial, or a clear disregard of their interests? 

If the answer to both is yes, then the court may find in favor of the shareholder. 

Common Examples of Oppressive Conduct 

Here are some real-world behaviors that may be considered oppressive—depending on the context: 

• Major deviations from normal business practices; 

• Hiding financial records or company documents from shareholders; 

• Misusing company money or assets without a valid business reason; 

• Acting in bad faith, especially by directors; 

• Freezing out or excluding minority shareholders from key decisions; and 

• Using company resources to take sides in shareholder disputes. 

Again, context is everything. Just because one of these behaviors occurs doesn’t automatically mean it’s oppressive. 

A Case in Point: Kong v. Au, 2022 ONSC 4407 

In Kong v. Au, the Ontario Superior Court was tasked with making a decision regarding a shareholder who wanted out of a business partnership. The shareholder claimed oppression after being excluded from business decisions that were made about loans and facilities. He argued that this exclusion was unfair and wanted the defendant to buy out his shares at fair market value. 

But the court wasn’t convinced. It found that the shareholder claiming oppression had never been meaningfully involved in business decisions in the first place. His real goal, the court said, was simply to force a buyout—not to address any genuine unfairness. The application was dismissed, and the Ontario Court of Appeal later upheld the decision in Kong v. Au, 2025 ONCA 252. 

Summary: Key Takeaways 

• Shareholder oppression involves conduct that’s unfair, prejudicial, or ignores the interests of shareholders. 

• Courts will look at what each party reasonably expected and whether those expectations were violated in an oppressive way. 

• Common red flags include excluding shareholders from decisions, misuse of funds, and lack of transparency. 

• Not every unfair act is oppressive—context is critical. 

• Courts are cautious not to let the oppression remedy become a tool for leverage in business exits or disputes. 

If you think you’ve been treated unfairly as a shareholder, it’s important to understand your rights—and the limits of the law. A legal advisor can help you assess your specific situation and provide you with strategic advice regarding your options. 

This article was co-written by lawyer Mike Bronsveld and Articling Student Meagan MacArthur.

If you require assistance with any Commercial Litigation matter, speak to a Lawyer at McKenzie Lake Lawyers LLP by calling (519) 672-5666.