Deadlock (Pat) situation in limited companies with two partners

Limited companies are the most common type of company in practice. Although the Turkish Commercial Code No. 6102 allows the establishment of a limited liability company with one partner, there are a significant number of limited companies with two partners in practice. As a result of the hybrid character of the limited company, which also includes the characteristics of a sole proprietorship, the two-partner relationship of the partners in limited companies is based on mutual trust and cooperation. While the partnership relationship continues, disagreements and disagreements may arise between the partners about the operation and management of the partnership. This situation may cause a bottleneck in the decision mechanisms or representation of the limited company with an equal distribution of capital shares (50%-50%). In the first part of this study, possible deadlock situations in a limited company with two partners are examined. In the second part, the legal consequences of the deadlock in the decision mechanisms or representation of the company are presented. Accordingly, the possibility of one of the partners leaving or being dismissed from the company due to the curfew may come to the fore. The blockage experienced in the management or representation of the partnership may be the subject of dismissal of the manager for just cause. Again, failure of the general assembly and the board of directors to fulfill their legal duties and authorities due to the curfew may result in a lawsuit for the dissolution of the company. In the third and last part, solution suggestions are presented for the prevention or elimination of the deadlock that prevents the company bodies from fulfilling their legal duties and authorities and ultimately leads to results contrary to the principle of keeping the company alive. In this context, in case of cancellation of the limited company on just cause, it is possible for the judge to eliminate the impasse by producing an alternative solution instead of giving a decision of termination. In addition, the partners can find solutions to prevent and resolve the stalemate by adding some regulations to the partnership agreement or by concluding contracts based on the law of obligations.