Pennsylvania § 1553 - Liability for unlawful dividends and other distributions.
Full text of Pennsylvania Pennsylvania Consolidated Statutes § 1553 — Liability for unlawful dividends and other distributions., with citation guidance and answers to common questions.
§ 1553. Liability for unlawful dividends and other distributions.
(a) Directors.--Except as otherwise provided pursuant to section 1713 (relating to personal liability of directors), a director who votes for or assents to any dividend or other distribution contrary to the provisions of this subpart or contrary to any restrictions contained in the bylaws shall, if he has not complied with the standard provided in or pursuant to section 1712 (relating to standard of care, justifiable reliance and business judgment rule), be liable to the corporation, jointly and severally with all other directors so voting or assenting, for the amount of the dividend that is paid or the value of the other distribution in excess of the amount of the dividend or other distribution that could have been made without a violation of the provisions of this subpart or the restrictions in the bylaws.
(b) Contribution by shareholders.--Any director against whom a claim is asserted under or pursuant to this section for the making of a distribution and who is held liable thereon shall be entitled to contribution from the shareholders who accepted or received any such distribution, knowing the distribution to have been made in violation of this subpart, in proportion to the amounts received by them.
(c) Contribution by other directors.--Any director against whom a claim is asserted under or pursuant to this section shall be entitled to contribution from any other director who voted for or assented to the action upon which the claim is asserted and who did not comply with the standard provided by or pursuant to this subpart for the performance of the duties of directors.
(d) Limitation of actions.--See 42 Pa.C.S. § 5524(5) (relating to two year limitation).
(e) Contrary articles ineffective.--Except as provided by subsection (a), this section may not be varied by any provision of the articles.
(Dec. 19, 1990, P.L.834, No.198, eff. imd.; Nov. 3, 2022, P.L.1791, No.122, eff. 60 days)
2022 Amendment. Act 122 amended subsec. (a).
1990 Amendment. Act 198 amended subsec. (a) and added subsec. (e).
Source: official Pennsylvania text · Last verified 2026-08-27
Frequently Asked Questions About Pennsylvania § 1553
What does Pennsylvania Consolidated Statutes § 1553 cover?
Section 1553 ("Liability for unlawful dividends and other distributions.") is part of the Pennsylvania Consolidated Statutes, the codified statutory law of Pennsylvania. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Pennsylvania § 1553?
A common citation format is "Pennsylvania Consolidated Statutes § 1553" (Pennsylvania). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Pennsylvania law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Pennsylvania official source linked on this page or consult a licensed Pennsylvania attorney.
How does Pennsylvania § 1553 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Pennsylvania can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Pennsylvania.