Virginia Code 13.1-644: Liability of shareholders and others.
A. A purchaser from a corporation of the corporation’s own shares is not liable to the corporation or the corporation’s creditors with respect to the shares except to pay the consideration for which the shares were authorized to be issued as provided in § 13.1-643 or specified in the subscription agreement.
Terms Used In Virginia Code 13.1-644
- Articles of incorporation: means all documents constituting, at any particular time, the charter of a corporation. See Virginia Code 13.1-603
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- 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.
- Executor: A male person named in a will to carry out the decedent
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Person: includes an individual and an entity. See Virginia Code 13.1-603
- Personal representative: includes the executor of a will or the administrator of the estate of a decedent, the administrator of such estate with the will annexed, the administrator of such estate unadministered by a former representative, whether there is a will or not, any person who is under the order of a circuit court to take into his possession the estate of a decedent for administration, and every other curator of a decedent's estate, for or against whom suits may be brought for causes of action that accrued to or against the decedent. See Virginia Code 1-234
- Shareholder: means a record shareholder. See Virginia Code 13.1-603
- Shares: means the units into which the proprietary interests in a corporation are divided. See Virginia Code 13.1-603
- Trustee: A person or institution holding and administering property in trust.
B. A person who becomes a transferee of shares in good faith and without knowledge that the consideration determined for the shares pursuant to § 13.1-643 or specified in the subscription agreement has not been paid is not personally liable for any unpaid portion of the consideration, but the initial transferor remains liable therefor.
C. An executor, administrator, conservator, guardian, trustee, assignee for the benefit of creditors, or receiver shall not, in any event, be personally liable to the corporation as transferee of a purchaser from the corporation of the corporation’s own shares but the estate of the purchaser and the purchaser’s assets in the hands of such personal representative shall be so liable.
D. A shareholder is not personally liable for any liabilities of the corporation, including liabilities arising from the acts of the corporation, except to the extent provided in a provision of the articles of incorporation permitted by subdivision B 3 (e) of § 13.1-619.
E. No pledgee or other holder of shares as collateral security shall be personally liable as a shareholder.
Code 1950, §§ 13-97, 13.1-22; 1956, c. 428; 1975, c. 500; 1985, c. 522; 2019, c. 734.