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The Vermont Statutes Online

 

Title 11A : Vermont Business Corporations

Chapter 003 : PURPOSES AND POWERS

(Cite as: 11A V.S.A. § 3.04)
  • § 3.04. Ultra vires

    (a) Except as provided in subsection (b) of this section, the validity of corporate action may not be challenged on the ground that the corporation lacks or lacked power to act.

    (b) A corporation's power to act may be challenged:

    (1) in a proceeding by a shareholder against the corporation to enjoin the act;

    (2) in a proceeding by the corporation, directly, derivatively, or through a receiver, trustee, or other legal representative, against an incumbent or former director, officer, employee, or agent of the corporation; or

    (3) in a proceeding by the attorney general under section 14.30 of this title.

    (c) In a shareholder's proceeding under subdivision (b)(1) of this section, to enjoin an unauthorized corporate act, the court may enjoin or set aside the act, if equitable and if all affected persons are parties to the proceeding, and may award damages for loss (other than anticipated profits) suffered by the corporation or another party because of enjoining the unauthorized act. (Added 1993, No. 85, § 2, eff. Jan. 1, 1994.)