Themis Essay 5307 Flashcards
Although shareholders in a corporation are generally not liable for the debts of a corporation, shareholders in a Virginia corporation are
free to enter into agreements that alter the way a corporation is managed, even though the agreement may be inconsistent with statutory provisions.
A corporate agreement must be set forth or referenced either
(i) in the articles or corporate bylaws and approved by all persons who are shareholders at the time of the agreement, or (ii) in a written agreement that is signed by all persons who are shareholders at the time of the agreement and that is made known to the operation.
The employees of a professional corporation are not shielded from
liability arising out of their own malpractice.
Employees of a professional corporation are shielded against
vicarious liability for malpractice committed by other professionals in the professional corporation.
Piercing the corporate veil, which holds an employee personally liable for the corporation’s obligations, is
usually only warranted in extraordinary circumstances.
After a corporation has issued stock, a voluntary dissolution can occur when board of directors adopts a proposal for dissolution and
(i) two-thirds of the outstanding shares approves, or (ii) when all shares consent to the dissolution, even without approval of the board.
A shareholder can seek the involuntary dissolution of a corporation if
the acts of the board of directors or those in control of the corporation are illegal, oppressive, or fraudulent.
Upon corporate termination, the property of the corporation passes
automatically to its directors as trustees in liquidation.
In a corporate termination, the corporate directors
(i) discharge the liabilities and obligations, and (ii) distribute the remainder of the corporation’s assets among its shareholders according to their respective rights and interests.
