Legal Disclaimer
You are responsible for reading, understanding and agreeing to the National Law Review s (NLR’s) and the National Law Forum LLC s Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free to use, no-log in database of legal and business articles. The content and links on www.NatLawReview.com are intended for general information purposes only. Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.
To embed, copy and paste the code into your website or blog:
I have commented in several posts on provisions of the California Corporations Code that address corporate action in times of emergency. As we were entering the Covid-19 pandemic shut down, I noted General Corporation Law weirdly shackles the ability of corporate boards to take action in times of emergency: Section 212(c)(2) states that during an emergency, a board may not take any action that (i) requires the vote of the shareholders (unless, of course, the vote was obtained before the emergency); or (ii) otherwise is not in the corporation s ordinary course of business. The latter restriction is inexplicable because an emergency might be just the very time when a board should take action outside of the corporation s ordinary course of business. I doubt that the legislature intended to impose unreasonable restraints on corporate boards during an emergency,