Business Judgment Rule History

How one views the business judgment rule as a liability rule or as an.

Business judgment rule history. In delaware the business judgement rule provides a presumption that in. Pemahaman tersebut sejalan dengan terminologi business judgement rule menurut black s law dictionary yang diartikan sebagai rule immunizes management from liability in corporate transaction undertaken within power of corporation and authority of management where there is reasonable basis to indicate that transaction was made with due care and good faith henry campbell black. Even so we must pause to note a bit of recent history.

The business judgment rule is a case law derived doctrine in corporations law that courts defer to the business judgment of corporate executives. Ada yang menarik dalam diskusi daring yang diselenggarakan hukumonline pada kamis 24 9 lalu dalam diskusi yang bertema implementasi doktrin business judgment rule dalam aktivitas bisnis perusahaan diungkap problem hukum implementasi doktrin bjr dalam pemeriksaan tindak pidana korupsi di pengadilan pasalnya bjr sendiri pada dasarnya merupakan doktrin impunitas bagi pengurus perusahaan. Black s law dictionary menyebutkan business judgment rule is rule immunizes management from liability in corporate transaction undertaken within power of corporation and authority of management where there is reasonable basis to indicate that transaction was made with due care and goof faith.

The business judgment rule rule the most prominent and important standard of judicial review under corporate law protects a decision of a corporate board of directors board from a fairness review entire fairness under delaware law unless a well pleaded complaint provides sufficient evidence that the board has breached its fiduciary duties or that the. Therefore the business judgment rule limits judicial inquiry into business decisions. For the purpose of this paper the authors adopted a doctrinal legal approach in.

Are clothed with presumption which the law accords to them of being in their conduct by a bona fide regard for the interests of the corporation whose affairs the stockholders have committed to their charge. It is contended that this rule which affords protection to directors who have made honest decisions will provide the necessary balance between greater accountability and economic efficiency. In addition it protects directors who are not negligent in the decision making process.

Nor time nor space nor the reader s interest span permits a full review of the controversy and besides my purpose here is to look forward rather than back. Business judgment rule bjr is a judicially created doctrine that protects directors from personal liability for decisions made in their capacity as a director so long as certain disqualifying behaviors are not established. Business judgment rule is the legal doctrine that a corporation s officers and directors cannot be liable for damages to stockholders for a business decision that proves unprofitable or harmful to the corporation so long as the decision was within the officers or directors discretionary power and was made on an informed basis in good faith without any direct conflict of interest and in the honest and reasonable belief that it was in the corporation s best interest.

The rule exists in some form in most common law countries including the u.