Utah Code 16-6a-822. General standards of conduct for directors and officers
Current as of: 2024 | Check for updates
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Terms Used In Utah Code 16-6a-822
- board of directors: means the body authorized to manage the affairs of a domestic or foreign nonprofit corporation. See Utah Code 16-6a-102
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Director: means a member of the board of directors. See Utah Code 16-6a-102
- Donor: The person who makes a gift.
- Member: includes :(34)(b)(i) "voting member"; and(34)(b)(ii) a shareholder in a water company. See Utah Code 16-6a-102
- Person: means an:
(40)(a) individual; or(40)(b) entity. See Utah Code 16-6a-102- Property: includes both real and personal property. See Utah Code 68-3-12.5
- Trustee: A person or institution holding and administering property in trust.
(1)(a) A director shall discharge the director’s duties as a director, including the director’s duties as a member of a committee of the board, in accordance with Subsection (2).(1)(b) An officer with discretionary authority shall discharge the officer’s duties under that authority in accordance with Subsection (2).(2) A director or an officer described in Subsection (1) shall discharge the director or officer’s duties:(2)(a) in good faith;(2)(b) with the care an ordinarily prudent person in a like position would exercise under similar circumstances; and(2)(c) in a manner the director or officer reasonably believes to be in the best interests of the nonprofit corporation.(3) In discharging duties, a director or officer is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:(3)(a) one or more officers or employees of the nonprofit corporation whom the director or officer reasonably believes to be reliable and competent in the matters presented;(3)(b) legal counsel, a public accountant, or another person as to matters the director or officer reasonably believes are within the person’s professional or expert competence;(3)(c) religious authorities or ministers, priests, rabbis, or other persons:(3)(c)(i) whose position or duties in the nonprofit corporation, or in a religious organization with which the nonprofit corporation is affiliated, the director or officer believes justify reliance and confidence; and(3)(c)(ii) who the director or officer believes to be reliable and competent in the matters presented; or(3)(d) in the case of a director, a committee of the board of directors of which the director is not a member if the director reasonably believes the committee merits confidence.(4) A director or officer is not acting in good faith if the director or officer has knowledge concerning the matter in question that makes reliance otherwise permitted by Subsection (3) unwarranted.(5) A director, regardless of title, may not be considered to be a trustee with respect to any property held or administered by the nonprofit corporation including property that may be subject to restrictions imposed by the donor or transferor of the property.(6) A director or officer is not liable to the nonprofit corporation, its members, or any conservator or receiver, or any assignee or successor-in-interest of the nonprofit corporation or member, for any action taken, or any failure to take any action, as an officer or director, as the case may be, unless:(6)(a) the director or officer has breached or failed to perform the duties of the office as set forth in this section; and(6)(b) the breach or failure to perform constitutes:(6)(b)(i) willful misconduct; or(6)(b)(ii) intentional infliction of harm on:(6)(b)(ii)(A) the nonprofit corporation; or(6)(b)(ii)(B) the members of the nonprofit corporation; or(6)(b)(iii) gross negligence. - Person: means an: