LAW 421 (Contemporary Business Law)
Week 4
WEEK 4 Discussion Question #1
• What aretheUCCprinciplesofgood faithand reasonableness to sales contracts?
• What arethedifferent ways thattitletransfers underUCCArticle2?
• Which partybears therisk?
• What distinguishes asaleon approval,saleon consignment,andsaleor return underUCCArticle2?
WEEK 4 Discussion Question #2
Greg,Kim,Phil,and Tianyaeachown 20percent ofthesharesofacompanyand serveas theboard ofdirectors ofthecompany,HomeHealth,Inc. Samis also a20 percent shareholder,but sheisnot amemberoftheboardofdirectors.When Tianyadies,her husband Michaelinheritshersharesofstock that werethen worth
$100,000,and replaces Tianyaon theboard ofdirectors.Unfortunately, Michael is sogrief-stricken that heis completelyinattentiveto corporateaffairs.During this period,Greg,Kim,and Phil extend loans to themselves totaling$250,000 from corporatefunds that theyneverpayback. When Samdiscoversthat HomeHealth, Inc.is insolvent,shesues Michael forbreach ofhisdutyofcaretothecorporation.
• Discuss Michael'sliabilityand fiduciaryduties.
MayMichael assertthelimited liabilityofthecorporateformas adefense?
• Is it likelythat acourt will piercethecorporateveil?Explain.
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