Fiduciary Duties- Loyalty Self Dealing

Question 1

Every partner is

Answer 1

an agent of the partnership

Question 2

Duties for LLE’s

Answer 2

1. Duty to put the other person first
2. Essence of the duty is the same as principal-agent
3. LLE’s have special language
   a. Duty of loyalty

Question 3

Two different duties in corporate law

Answer 3

1. Duty of loyalty

2 Duty of care

Question 4

Duty of loyalty

Answer 4

a. The concept of loyalty. Fiduciary must subordinate his individual and private interest to his duty to the corporation whenever the two conflict.

Question 5

Duty of care

Answer 5

a. To act as a reasonable person would. Responsibility is care and diligence requires of an agent or fiduciary.
i. Scope matters
F. Burger flipper v. President of Company

Question 6

Questions to focus on:

Answer 6

A.	How did the problem come about?
B.	What caused the potential conflict?
C.	What should the parties have done?
D.	Why didn’t they do that?
E.	How can they fix it?
F.	What lesson do we take

Question 7

Directors of a bus corp arent trustees and arent

Answer 7

held to strict accountability as such.

Question 8

Directors are however agents/fiduciaries two paramount obligations

Answer 8

responsibility, loyalty

Question 9

BJR only applies to

Answer 9

disinterested directors

Question 10

avoid these conflicts by:

Answer 10

immunize (before) - indy decision makers OR after convince court it was a good bus decision, difficult burden

Question 11

When BJR doesnt apply use:

Answer 11

Entire Fairness test: was it fair to the corp

Question 12

directors judgement is protected by

Answer 12

BJR

Question 13

Directors only get benefit of BJR IF

Answer 13

They are disinterested

Question 14

If directros are interested they must show

Answer 14

fiarness of transactin (burden on directors)

Question 15

std of utmost duty and undivided loyalty

Answer 15

more than just not being a bad guy Punctilio of honor the most sensitive

Question 16

interested directors may be cool if

Answer 16

A. Directors action had pre authorization/ratification
B. Shareholders voted to say it was god
C. If transaction judged according to the circumstances at the time of commitment, is established to have been fair.

Question 17

Remedies

Answer 17

Constructive trust- take property and pay back those harmed

Question 18

share repurchase agreements

Answer 18

never work