A minority partner in a consulting services company decided to legally challenge the method approved by the majority of partners to distribute the company’s profits. The reason for her challenge was the criterion adopted for dividing profits: the number of days worked by each partner.
In the minority partner’s view, pro labore should remunerate each partner for the days worked, while profits should be distributed based on each partner’s share of the share capital. The basis for her disagreement is that the criterion adopted by the majority, and incorporated into the share capital, would imply excluding some partners from profit sharing, which is prohibited by Article 1008 of the Civil Code.
When analyzing the case, the STJ (Superior Court of Justice) understood that companies have broad freedom to choose the criteria based on which profits will be distributed, and the methodology for distributing the profits in question (days worked), in theory, does not prevent any of the partners from participating in the profits, especially since it is a service provision company.
This decision constitutes yet another precedent that ensures contractual freedom for companies, which will be able to define their corporate arrangements in the way that is most beneficial to the parties, with minimal intervention from the State, represented by the Executive or even the Judiciary.
