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This question is prompted by widespread speculation that the Labour party might split if and when Jeremy Corbyn becomes its leader, but I am also interested in general terms.

When parties split, if the breakaway group is small no one disputes that they are a breakaway group and that the other, larger group get to keep the party name, funds, membership list and so on. An example is when the the "Gang of Four" left the Labour party to form the SDP in 1981.

But what if the group "leaving" and the group "staying" are roughly the same size? Both might have plausible claims to be the "true" Labour party. Both might reasonably claim to be the ones who are staying and claim that it's the other guys who are leaving them. You could also get intractable problems if the split among MPs is very different to the split among the party members. Bringing further variables into the situation, such as what happens regarding paid party officials and trade unions who provide funding for the party, makes it even more complicated.

How could such a split be handled fairly? Are there any precedents for this situation, or laws dealing with it?

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    Given the tags... obligatory Monty Python's "Judean People's Front. We're the People's Front of Judea! Judean People's Front" seems to be in order
    – user4012
    Commented Sep 1, 2015 at 14:27
  • The real-life history of the many schisms in the British communist movement upon which that sketch was based might provide the answer to my question - I don't know enough about the subject to know for sure. I do remember when I was young being surprised to learn that the Communist Party of Great Britain and the Communist Party of Great Britain (Marxist-Leninist) were separate and rival organisations. Wikipedia doesn't say what their relative sizes were, though.
    – Lostinfrance
    Commented Sep 1, 2015 at 15:15
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    StarSlateCodex blog recently ran an article that is somewhat relevant to the concept (the idea that the largest political differences tend to arise in the closest-aligned demographics/ideologies). Not very useful to the practical political core of your excellent question, sadly
    – user4012
    Commented Sep 1, 2015 at 15:26

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A party has an elected leadership.

A member of a party who doesn't agree with the party leadership (and doesn't have enough backing to vote a different leadership) has no option but to leave the party. Those who are loyal to the current leadership keep the party name and the "rebels" form a new party.

This scenario assumes that the members of the party leadership are not at odds with each other. What if the party has multiple elected leaders and they don't agree? In that case either the party notices that the current party leadership can't work constructively and votes a new leadership of people who can, or single members of the leadership resign. The remaining leadership members would keep leading the party under the current name while those who resign would have the option to form a new party under a new name.

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