§ 23-17-13-1 — Duties; reliance on statements of and information given by others; conditions for liability; director not trustee

Indiana § 23-17-13-1

• Jurisdiction: Indiana
• Title 23: BUSINESS AND OTHER ASSOCIATIONS
• Art. 17: NONPROFIT CORPORATIONS
• Ch. 13: Standards of Conduct for Directors

Text

(a) A director shall, based on facts then
known to the director, discharge duties as a director, including the
director's duties as a member of a committee, as follows:
(1) In good faith.
(2) With the care an ordinarily prudent person in a like position
would exercise under similar circumstances.
(3) 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 may rely on
information, opinions, reports, or statements, including financial
statements and other financial data, if prepared or presented by one (1)
of the following:
(1) An officer or employee of the corporation whom the director
reasonably believes to be reliable and competent in the matters
presented.
(2) Legal counsel, certified public accountants, or other persons
as to matters the director reasonably believes are within the
person's professional or expert competence.
(3) A committee of the board of directors of which the director is
not a member if the director reasonably believes the committee
merits confidence.
(4) In the case of religious corporations, religious authorities and
ministers, priests, rabbis, or other persons whose position or
duties in the religious organization the director believes justify
reliance and confidence and whom the director believes to be
reliable and competent in the matters presented.
(c) A director is not acting in good faith if the director has
knowledge concerning a matter in question that makes reliance
otherwise permitted by subsection (b) unwarranted.
(d) A director is not liable for an action taken as a director, or failure
to take an action, unless the:
(1) director has breached or failed to perform the duties of the
director's office in compliance with this section; and
(2) breach or failure to perform constitutes willful misconduct or
recklessness.
(e) A director is not considered to be a trustee with respect to a
corporation or with respect to any property held or administered by the
corporation, including property that may be subject to restrictions
imposed by the donor or transferor of the property.

Legislative History

As added by P.L.179-1991, SEC.1. Amended by P.L.110-2008, SEC.5.