2011 Louisiana Laws
Revised Statutes
TITLE 12 — Corporations and associations
RS 12:143 — Involuntary proceedings for dissolution; grounds; institution; appointment of liquidator

§143. Involuntary proceedings for dissolution; grounds; institution; appointment of liquidator

A. The court may entertain a proceeding for involuntary dissolution under its supervision when it is made to appear that:

(1) The corporate assets are insufficient to pay all just demands for which the corporation is liable, or to afford reasonable security to those who may deal with it; or

(2) The objects of the corporation have wholly failed, or are entirely abandoned, or their accomplishment is impracticable; or

(3) It is beneficial to the interests of the shareholders that the corporation should be liquidated and dissolved; or

(4) The directors are deadlocked in the management of the corporate affairs, and the shareholders are unable to break the deadlock; or

(5) The shareholders are deadlocked in voting power, and have failed, for a period which includes at least two consecutive annual meeting dates, to elect successors to directors whose terms have expired or would have expired upon the election of their successors, but only if irreparable injury to the corporation is being suffered or is threatened by reason thereof, or if irreparable injury to the shareholders is being suffered or is threatened by reason thereof and the court shall determine that such irreparable injury warrants dissolution after giving due regard to the interests of the other shareholders, the employees, and the public; or

(6) The corporation has failed, neglected, or refused, without justifiable cause, to commence business within a period of one year from the date of its incorporation, or, after commencing business, has suspended business for at least one year, and has no real intention of commencing or resuming business; or

(7) The corporation has been guilty of gross and persistent ultra vires acts; or

(8) Judgment has been entered annulling, vacating or forfeiting the corporation's articles and franchise in accordance with the provisions of R.S. 12:163(B); or

(9)(a) A receiver has been appointed under R.S. 12:151 to take charge of the corporation's property, and either (b) there is no reasonable prospect of return of control of the corporation to its shareholders within a reasonable time or (c) the business of the corporation is operating at a loss and there is no reasonable prospect of restoring it to profitable operation within a reasonable time.

B. An involuntary proceeding for dissolution may be instituted against a corporation by either:

(1) A shareholder or shareholders, severally or jointly, who have been registered owners, for a period of not less than six months, of not less than twenty per cent of the entire outstanding shares of the corporation; or

(2) A majority of the corporation's directors; or

(3) A creditor whose claim has been reduced to judgment, on which execution has been issued and returned "nulla bona"; or

(4) A receiver appointed under R.S. 12:151 to take charge of the corporation's property.

C. When a corporation has only two shareholders, each of which owns one-half of the outstanding shares of each class, and those shareholders are engaged in a joint venture solely between themselves and the corporation, then either shareholder may, unless the articles expressly prohibit dissolution pursuant to this Subsection, file a petition stating that it desires to discontinue such joint venture and to dispose of the assets used therein in accordance with a plan to be agreed upon by both shareholders. Such petition, to which shall be attached a copy of the proposed plan of discontinuance and distribution, shall be served on the corporation and on the other shareholder. Unless both shareholders file with the court (1) within three months of the date of last service of such petition, a certificate that they have agreed on such plan, or a modification thereof, and (2) within one year from the date of last service of such petition, a certificate that the distribution provided by such plan has been completed, the court may proceed with involuntary dissolution of such corporation.

D. The commencement of a proceeding for dissolution out of court shall not affect the right of any person to institute an involuntary proceeding for dissolution.

E. The court may, after trial, appoint a judicial liquidator, and may, ex parte pending trial, appoint a temporary liquidator whose authority shall cease upon appointment of a judicial liquidator, upon dismissal of the petition, or upon appointment of a receiver.

F. Unless the corporation's articles and franchise have been annulled, vacated or forfeited, the court may, on motion of any interested party at any stage of the proceeding, appoint a receiver to take charge of the corporation's property pursuant to Part XV of this Chapter, if the corporation is engaged in a business affected with the public interest, or if there is a reasonable prospect that a receiver could return control of the corporation to its shareholders as a going concern within a reasonable time.

G. When the charter of any corporation possessed of property rights or credits has expired, or been repealed without providing for liquidation, and no shareholders or directors or officers of the corporation can be found, the district court of the principal office of the secretary of state, or of the place where said corporation was conducting its business, or at the place where said corporation owns immovable property, or otherwise of the principal office of the Secretary of State or of the place where said corporation last had its registered office or of the place where said corporation owns immovable property shall be authorized, upon application of the Secretary of State, to appoint a liquidator. The liquidator appointed pursuant to the provisions of this Subsection shall take charge of the property of the defunct corporation, collect the debts owed the corporation, enforce all claims and rights of the corporation, and pay all creditors the debts owed by the corporation before completing the liquidation.

Acts 1968, No. 105, §1. Amended by Acts 1970, No. 50, §13, emerg. eff. June 18, 1970, at 5:05 P.M.; Acts 1976, No. 587, §1, eff. Aug. 4, 1976; Acts 1982, No. 871, §1; Acts 1984, No. 406, §1; Acts 1985, No. 269, §1, eff. July 6, 1985.