Deadlock between equal owners paralyses a company, and the remedies are limited and blunt.
Statutory grounds. Director deadlock causing irreparable injury or preventing the business from being conducted to advantage; shareholder deadlock in electing directors for a period; and for LLCs, that it is not reasonably practicable to carry on the business.
What courts prefer. Solutions that preserve the business. Appointment of a provisional director or a custodian with authority to break ties; appointment of a receiver; an ordered buyout where a statute permits an election; and a court-supervised sale.
Dissolution where nothing else works, with a wind-down that usually destroys going-concern value.
Not reasonably practicable is a narrower standard than oppression, and courts have declined relief where a profitable business continued to operate despite hostility between the members.
Evidence. Missed meetings, failed votes on necessary actions, unpaid obligations, lost opportunities, employee departures, and the operational consequences — not merely the personal animosity.
Strategy. These cases resolve in a buyout in the large majority of instances, which means the valuation work should begin at the outset and the litigation should be structured to reach that question quickly.