RS 12:226 Relation of directors and officers to corporation and members; liability of officers and directors - Louisiana Statutes

§226.  Relation of directors and officers to corporation and members; liability of officers and directors

A.  Officers and directors shall be deemed to stand in a fiduciary relation to the corporation and its members, and shall discharge the duties of their respective positions in good faith, and with that diligence, care, judgment and skill which ordinarily prudent men would exercise under similar circumstances in like positions.  

B.  Any officers or directors who knowingly, or without the exercise of reasonable care and inquiry, consent to the issuance of shares in violation of the provisions of this Chapter, shall be liable jointly and severally to the corporation and any person who suffers any loss or damage as a result thereof.  

C.  If property or services taken in payment for shares are grossly overvalued contrary to the provisions of this Chapter, the officers or directors who knowingly, or without the exercise of reasonable care and inquiry, consented thereto, or voted in favor thereof, shall be liable jointly and severally to the corporation for the benefit of creditors or members, as their respective and relative interests may appear, for any loss or damage arising therefrom.  

D.  If any unlawful distribution, payment or return of assets be made to the members, or if the corporation purchase or redeem any of its own shares in violation of this Chapter, the directors who knowingly, or without the exercise of reasonable care and inquiry, voted in favor thereof shall be liable jointly and severally to the corporation, or to creditors of the corporation, or to both, in an amount equal to the amount of the unlawful distribution.  An action to enforce such liability must be brought within two years from the date on which the distribution was made, and this time limit shall not be subject to suspension on any ground, nor to interruption except by timely suit.  

E.  A director acting in reliance, in good faith, on a report made to the board of directors, or to any committee thereof, by an official of the corporation or by an appraiser selected by the board or by any committee thereof with reasonable care, or on financial statements or other records of the corporation represented as accurate by the president or other officer in charge of the corporation's books of account or of such records, or stated in a written report by independent or certified public accountants fairly to reflect the corporation's financial condition, shall not be held liable under the provisions of this section.  

F.  Nothing contained in this section shall derogate from any indemnity authorized by R.S. 12:227.  

G.  A director shall not be liable for the commission of a prohibited act if he was absent from the meeting of directors at which the action was authorized, or if he was present or represented at such meeting, and his dissent therefrom was either noted in the minutes of the meeting or filed promptly thereafter in the registered office of the corporation.  

Acts 1968, No. 105, §1.