Key points
- Issue: A shareholder excluded from a simplified joint-stock company (SAS) sought the annulment of the general meeting that had excluded him and an award of damages.
- Decision: the court ruled that the exclusion was valid, as the procedure set out in the articles of association had been followed and there was no dispute as to the existence of a serious ground for exclusion under the articles of association.
- Outcome: The resolutions on the exclusion and the buy-back of shares were upheld, and the shareholder was ordered to pay €3,000 to the company towards its costs.
Removed from management and subsequently excluded: shareholder fails to have the meeting annulled
By judgment of 24 June 2026 (Case No. 2025F01686), the Nanterre Commercial Court dismissed all claims for annulment brought by an excluded shareholder, in favour of the SAS. The exclusion of a shareholder from an SAS is governed entirely by the articles of association. The court therefore checks that these have been followed to the letter, step by step.
An exclusion voted through following the dismissal of the managing director
The shareholder contested his exclusion from a simplified joint-stock company (SAS) established in 2021 by five shareholders, each holding approximately 20 per cent of the share capital. He had been removed from his position as managing director by the general meeting of 16 June 2025. The articles of association stipulated that the dismissal of the managing director constituted serious grounds for exclusion.
On 5 September 2025, an extraordinary general meeting voted to exclude him, decided to buy back his shares and appointed the purchaser. In the absence of an agreement, the price was to be set by an expert. The shareholder sought the annulment of these three resolutions and €10,000 in damages.
The company, represented by Goldwin Avocats, argued that the clause and the procedure had been complied with. The dispute therefore centred on the validity of the exclusion, not on its appropriateness.
The court’s ruling on the exclusion of a shareholder from an SAS
The court upheld the exclusion of a shareholder from an SAS, as there were no irregularities in the procedure laid down in the articles of association.Article L227-16 of the Commercial Code permits the articlesof association of an SAS to require a shareholder to sell their shares. It is therefore the articles of association that set out the grounds and the procedure.
The court verified each condition set out in the articles of association:
- the grounds for exclusion notified by registered post fifteen days beforehand;
- a prior meeting to allow the shareholder to present their defence;
- a vote by an extraordinary majority;
- the appointment of the purchaser of the shares.
A single uncontested ground – the revocation of the shareholder’s mandate – was sufficient to justify the exclusion. The court dismissed the alleged abuse of majority, as the decisions were lawful and well-founded. It ordered the shareholder to pay €3,000 pursuant toArticle 700 of the Code of Civil Procedure, which covers part of the legal costs.
What this ruling means for shareholders of an SAS
A well-drafted exclusion clause allows a shareholder to be excluded, provided that every prescribed step is followed. The judges scrutinise the notice of meeting, the time limit, the prior hearing, the majority required and the grounds given. Check these points before conveninga company’s general meeting.
For the shareholder concerned, any challenge must relate to specific irregularities. In this case, the lack of objections at the meeting and an uncontested ground carried significant weight. The judge scrutinises the procedure, not the relationships between shareholders.
Each situation is analysed on a case-by-case basis, depending on the wording of the articles of association. Are you considering excluding a shareholder or contesting your own exclusion? Contact one of our solicitors specialising in disputes between shareholders to review your articles of association.
Related areas of expertise
Company law › Lawyer in partnership disputes
Frequently asked questions about the exclusion of a shareholder from an SAS
No. Exclusion requires a clause in the articles of association, as permitted by Article L227-16 of the Commercial Code. Without such a clause, the other shareholders cannot force a shareholder to leave. The clause may be added during the course of the company’s existence by a collective decision of the shareholders taken in accordance with the provisions of the articlesof association, as provided for inArticle L227-19 of the Commercial Code.
Yes, where the articles of association so provide, which is almost always the case. The shareholder must be made aware of the allegations and be given the opportunity to present their defence before a decision is taken. In this case, a notice to attend a preliminary meeting, sent fifteen days in advance, was sufficient, even though the shareholder did not attend.
The shareholders, provided they agree on a price. Failing that,Article 1843-4 of the Civil Code entrusts the determination of the price to an expert appointed by the court. The expert applies the valuation rules laid down in the articles of association or in a partnership agreement. A disagreement over the price does not invalidate the exclusion itself.
Jonathan BELLAICHE
