Corporations & LLCs
The duty of care creates a presumption that in making a business decision, the directors acted on an informed basis, in good faith, and in the honest belief that the action taken was in the best interest of the company
Business judgement rule
A claim filed by a defendant against a plaintiff
Counterclaim
These are needed to modify a contract under common law and the UCC (two separate answers)
Consideration and good faith
A party claiming that the directors breached their duty of care has the ________
Burden of proof
This type of claim has two requirements: (1) there must be complete diversity of citizenship and (2) the amount in controversy must be over $75,000
Diversity jurisdiction
Under ________, a party must substantially perform its contractual obligations in order to demand performance (usually payment). UCC Article 2, however, requires ________ unless the parties have an installment contract
Common law
Perfect tender
Filing a derivative suit has the following requirements (hint: down in the dumps)
Standing
Adequacy
Demand
This type of claim must be created by federal law or created by state law but depend on a substantial federal question
Federal-question jurisdiction
Bonus: Where must it appear?
A plaintiff should file a _______ if he seeks punitive damages under contract law. These damages must be _____ and _______.
Tort action, established, reasonable
The plaintiff can _______ if it can show that shareholders of the corporation or members of an LLC abused the privilege of incorporation, and fairness requires holding them liable
Piercing the veil
Under this rule, the plaintiffs' claims must arise out of the same transaction or occurrence and the claims must involve a common question of law or fact
Permissive joinder (joinder of plaintiffs)
This statute applies to contracts for the sale of land, surety agreements, contracts that are impossible to perform within a year, contracts made in contemplation of marriage, contracts entered into by an executor on behalf of the estate, and contracts for the sale of goods of $500 or more
Satute of frauds
A _____________ is a appropriate when the injury is caused to the corporation and the shareholder is trying to enforce the corporation's rights
A _______ is appropriate when the wrong done amounts to a breach of duty owed to the shareholder personally
Direct suit
Derivative suit
When the federal court transfers a case to another district, the court will apply the law of the _________
Transferor forum