§414D-149 General standards for directors.

487 words·~2 min read·/hi/414d-149

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)A director shall discharge the director's duties as a director, including the director's duties as a member of a committee:

(1)In good faith;

(2)In a manner that is consistent with the director's duty of loyalty to the corporation;

(3)With the care an ordinarily prudent person in a like position would exercise under similar circumstances; and

(4)In a manner the director reasonably believes to be in the best interests of the corporation.

(b)In discharging the director's duties, a director is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:

(1)One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented;

(2)Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the person's professional or expert competence; or

(3)A committee of the board of which the director is not a member, as to matters within its jurisdiction, if the director reasonably believes the committee merits confidence.

(c)A director is not acting in good faith if the director has knowledge concerning the matter in question that makes reliance otherwise permitted by subsection

(b)unwarranted.

(d)A director is not liable to the corporation, any member, or any other person for any action taken or not taken as a director, if the director acted in compliance with this section.

(e)A director shall not be deemed to be a trustee with respect to the corporation or with respect to any property held or administered by the corporation, including without limit, property that may be subject to restrictions imposed by the donor or transferor of the property.

(f)Any person who serves as a director to the corporation without remuneration or expectation of remuneration shall not be liable for damage, injury, or loss caused by or resulting from the person's performance of, or failure to perform duties of, the position to which the person was elected or appointed, unless the person was grossly negligent in the performance of, or failure to perform, such duties. For purposes of this section, remuneration does not include payment of reasonable expenses and indemnification or insurance for actions as a director as allowed by sections 414D-159 to 414D-167. [L 2001, c 105, pt of §1; am L 2002, c 130, §52; am L 2017, c 87, §2]

Case Notes

While plaintiff, a consultant, claimed that defendant, chairman of the board of the Hawaii Health Connector, in light of the exchange's insolvency, had a fiduciary duty to plaintiff, the court found that plaintiff's breach of fiduciary duty claim should be dismissed. The complaint did not allege that any of the defendants were remunerated for their services or that they were grossly negligent in carrying out their duties. 236 F. Supp. 3d 1267 (2017).