Georgia § 14-2-831 - Derivative actions against directors and officers.

§ 14-2-831. Derivative actions against directors and officers.

Subject to Code Sections 14-2-830 and 14-2-842, a derivative proceeding, as defined in paragraph (1) of Code Section 14-2-740, may be brought by a shareholder, or an action may be brought by the corporation, against one or more directors or officers of the corporation to procure for the benefit of the corporation a judgment for the following relief: Subject to any provision of the articles of incorporation authorized pursuant to paragraph (4) of subsection (b) of Code Section 14-2-202, to compel the defendant to account for official conduct or to decree any other relief called for by his or her official conduct in the following cases: The neglect of, failure to perform, or other violation of his or her duties in the management of the corporation or in the disposition of corporate assets; The acquisition, transfer to others, loss, or waste of corporate assets due to any neglect of, failure to perform, or other violation of duties; or The appropriation, in violation of his or her duties, of any business opportunity of the corporation; To enjoin a proposed unlawful conveyance, assignment, or transfer of corporate assets or other unlawful transaction where there is sufficient evidence that it will be made; and To set aside an unlawful conveyance, assignment, or transfer of corporate assets where the transferee knew of its unlawfulness and is made a party to the action. No action shall be brought for the relief provided in subsection (a) of this Code section more than four years from the time the cause of action accrued. This Code section shall not limit any liability otherwise imposed by law upon any director or officer or any third party. (Code 1981, § 14-2-831 , enacted by Ga. L. 1989, p. 946, § 34; Ga. L. 2016, p. 225, § 1-6/SB 128.) The 2016 amendment, effective July 1, 2016, inserted "or her" throughout subsection (a); substituted "Subject to Code Sections 14-2-830 and 14-2-842, a derivative proceeding, as defined in paragraph (1)" for "A derivative proceeding, as defined in subsection (a)" in subsection (a); and substituted "Subject to any provision of the articles of incorporation authorized pursuant to paragraph (4) of subsection (b) of Code Section 14-2-202, to" for "To" in paragraph (a)(1). Editor's notes. - Ga. L. 1989, p. 946, § 33, effective July 1, 1989, renumbered former Code Section 14-2-831 as present Code Section 14-2-832. Law reviews. - For article, "Litigation Discovery and Corporate Governance: The Missing Story About the 'Genius of American Corporate Law,"' see 63 Emory L.J. 1383 (2014).