The Concept of Derivative Action and Its Exceptional Feature (A Comparative Study in English, American, French and Iranian Law)

In the company law، the vindication of the company’s rights is directorial affairs، and in the exclusive authority of directors who represent a company. In the cases، which the directors avoid of vindicating the rights of their company، due to personal interests or the interests of those who may have ascendancy over them، the prediction of suitable strategy would secure the rights of the company and its minority shareholders. In this respect، legal systems have allowed the shareholders to intervene and bring an action in the name of the company. This is called a “Derivative Action”. The contrast of this sort of action with independent legal personality and the exclusive representation of the directors of the company، necessitates this sort of action to be defined as exceptional and thus limited in the domain of enactment so that the minority shareholders do not have the power to abuse it in order to interfere with the way the directors operate، and prevent them from bringing action against the competent and capable directors. Therefore the derivative action is limited in domain and is usable only in fixed or appointed cases. In England، France and Iran، the legislature has enacted the derivative action for the cases of vindicating the company’s rights against directorial faults، whereas in the United States، it can be brought against any person.