Rights, Duties, and Authority of Owners and Management

Free CPA REG (Taxation & Regulation) lesson in Business Law. 16 min read, ~2,470 words.

Partners owe duties of loyalty (no self-dealing, no competing, no usurping corporate opportunities) and care (gross-negligence standard, not ordinary). Directors owe care (ordinary prudence) and loyalty; the business judgment rule shields informed, good-faith, rational decisions but not self-dealing or uninformed action. A conflicted transaction is voidable (not void) unless disinterested...

What this lesson covers

• Content
• Example 1
• Example 2
• Common Mistakes
• Check Your Understanding
• Exam Shortcuts

Learning objectives

• II.E2

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