Do directors face for a breach of fiduciary duty

Assignment Help Operation Management

Reference no: EM13840663

1. What consequences, if any, do directors face for a breach of fiduciary duty?

2. Brown, the president and director of a corporation engaged in owning and operating a chain of motels, was advised, on what seemed to be good authority that a superhighway was to be constructed through the town of X, which would be a most desirable location for a motel. Brown presented these facts to the board of directors of the motel corporation and recommended that the corporation build a motel in the town of X at the location described. The board of directors agreed, and the new motel was constructed. However, the superhighway plans were changed after the motel was constructed, and the highway was never built. Later, a packinghouse was built on property adjoining the motel, and as a result the corporation sustained a considerable loss. The shareholders brought an appropriate action against Brown, charging that his proposal had caused the corporation a substantial loss.

Has Brown breached his fiduciary duty? Explain.

Reference no: EM13840663

Questions Cloud

The role of the environment in process of crime causation : Research will be conducted on the topic, the role of the environment in the process of crime causation to find out what are the environmental factors, which influence social behavior of a person leading to the specific individual to perceive certa..

Department of justice requires prosecutors to consider : Identify and explain some of the factors that the Department of Justice requires prosecutors to consider when charging an organization. What benefits do organizations get from following these factors and the Federal Sentencing Guidelines?

What system factors influence organizational performance? : What system factors influence organizational performance?

How many stockholders are entitled to vote at the meeting : You work for Alpha Corporation and are in charge of handling the shareholders annual meeting, which is scheduled for March 15. Right now, the company needs to elect new directors, hire a new chief executive officer, amend the articles of incorporatio..

Do directors face for a breach of fiduciary duty : What consequences, if any, do directors face for a breach of fiduciary duty? Brown, the president and director of a corporation engaged in owning and operating a chain of motels, was advised, on what seemed to be good authority that a superhighway wa..

How does an individual form a corporation : Why would an individual choose to form a business as a corporation as opposed to a sole proprietorship? How does an individual form a corporation? How does a company become a "public" company? What are some of the differences between private and publ..

Principles of respect for autonomy-nonmaleficence-beneficenc : Major principles of health care ethics include the principles of respect for autonomy, nonmaleficence, beneficence, and justice. Consider the following ethical dilemma: Your patient was recently diagnosed with a rare cancer that has invaded his liver..

Create an original code of ethics and evaluation paper : create an original Code of Ethics and Evaluation Paper

What is the purpose of the boot loader : What is the purpose of the boot loader during the boot-up process

User Account

All Pages