§ 23-1-22-5 — Challenging corporation's power to act; ultra vires acts

Indiana § 23-1-22-5

• Jurisdiction: Indiana
• Title 23: BUSINESS AND OTHER ASSOCIATIONS
• Art. 1: INDIANA BUSINESS CORPORATION LAW
• Ch. 22: Powers and Purposes

Text

(a) Except as provided in subsection (b), 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 IC 23-1-47-1.
(c) In a shareholder's proceeding under subsection (b)(1) 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.

Legislative History

As added by P.L.149-1986, SEC.6.