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New Zealand law explained for everyone

Companies Act 1993

Enforcement - Derivative actions

168: Compromise, settlement, or withdrawal of derivative action

You could also call this:

“Getting court approval to end or change a legal case started by shareholders or directors”

If you’re a shareholder or director and you start a legal case or join one that’s already happening, you need to get permission from the court first. This is called “leave of the court”. You can find more information about this in section 165.

Once you’ve started or joined the case, you can’t just decide to stop it, make a deal, or settle it on your own. You have to ask the court for approval first. This rule is there to make sure that everything is fair and proper.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320828.

Topics:
Business > Industry rules
Crime and justice > Courts and legal help
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167: Powers of court where leave granted, or

“Court's powers when allowing legal action about a company”

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Part 9 Enforcement
Derivative actions

168Compromise, settlement, or withdrawal of derivative action

  1. No proceedings brought by a shareholder or a director or in which a shareholder or a director intervenes, as the case may be, with leave of the court under section 165, may be settled or compromised or discontinued without the approval of the court.