(1) Each director shall discharge the director's duties as a director, including the director's duties as a member of a committee, and each officer with discretionary authority shall discharge the officer's duties under that authority:
(a) In good faith;
(b) With care; and
(c) In a manner the director or officer reasonably believes to be in the best interests of the corporation.
(2) In discharging duties under this section, a director or officer is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:
(a) One or more officers or employees of the corporation whom the director or officer reasonably believes to be reliable and competent with respect to the information, opinions, reports, or statements;
(b) One or more legal counsel, accountants, or other persons retained by the corporation as to matters involving expertise or skills the director or officer reasonably believes are within the person's professional or expert competence;
(c) In the case of a director, a committee of the board of directors of which the director is not a member if the director reasonably believes the committee merits confidence; or
(d) In the case of an officer, the board of directors or any committee of the board of directors.
(3) A director or officer may not rely on information, opinion, reports, or statements as permitted by subsection (2) of this section if the director or officer has knowledge concerning the matter in question that makes the reliance unwarranted.
(4) A director or officer of a corporation, in the performance of duties in that capacity, does not have any fiduciary duty to any creditor of the corporation arising only from the status as a creditor, whether the corporation is solvent or insolvent.
Source: L. 2019: Entire part amended with relocations, (SB 19-086), ch. 166, p. 1930, § 35, effective July 1, 2020.
Editor's note: This section is similar to former § 7-108-401 as it existed prior to 2020.
Notes of Decisions
Paratransit Risk Retention Grp. Ins. Co. v. Kamins, 160 P.3d 307 (Colo. Ct. App. 2007).
· cites it 9× “2006, without measuring insolvency as of the date of each distribution and without appropriately discounting contingent liabilities, and (2) in not considering the "safe harbor" defense under § 7-108-401, C.R.S.2006, We *314 conclude a remand for further findings is required.”
Weinstein v. Colborne Foodbotics, LLC, 302 P.3d 263 (Colo. 2013).
· cites it 6× “assents to a distribution made in violation of section 7 106-401 or the articles of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating said section or the articles of…”
Horejs v. Steele (In Re Steele), 292 B.R. 422 (Bankr.D. Colo. 2003).
· cites it 6× “Plaintiff argues that Colo. Rev.Stat. § 7-108-401 creates such fiduciary duties.”
McCallum Fam. L.L.C. v. Winger, 221 P.3d 69 (Colo. Ct. App. 2009).
· cites it 3× “However, this common law rule arguably conflicts with section 7-108-401(5), C.R.S.2009. As amended in 2006, that statute provides that a "director or officer of a corporation, in the performance of duties in that capacity, shall not have any fiduciary duty to any creditor of the…”
Alexander v. Anstine, 152 P.3d 497 (Colo. 2007).
· cites it 2× “A 2006 amendment to the Colorado Revised Statutes, which does not apply to this case, states that directors and officers of corporations owe no fiduciary duties to the corporation's creditors.”
Michaelson v. Michaelson, 939 P.2d 835 (Colo. 1997).
“(1986) (repealed 1994); Colorado Business Corporation Act §§ 7-108-401, -402, 3A C.R.S. (1996 Supp.”
— Colo. Rev. Stat. § 7-108-401(1) — 1 case
— Colo. Rev. Stat. § 7-108-401(2) — 1 case
Paratransit Risk Retention Grp. Ins. Co. v. Kamins, 160 P.3d 307 (Colo. Ct. App. 2007).
“2006, without measuring insolvency as of the date of each distribution and without appropriately discounting contingent liabilities, and (2) in not considering the "safe harbor" defense under § 7-108-401, C.R.S.2006, We *314 conclude a remand for further findings is required.”
— Colo. Rev. Stat. § 7-108-401(5) — 4 cases
McCallum Fam. L.L.C. v. Winger, 221 P.3d 69 (Colo. Ct. App. 2009).
“However, this common law rule arguably conflicts with section 7-108-401(5), C.R.S.2009. As amended in 2006, that statute provides that a "director or officer of a corporation, in the performance of duties in that capacity, shall not have any fiduciary duty to any creditor of the…”
Weinstein v. Colborne Foodbotics, LLC, 302 P.3d 263 (Colo. 2013).
“assents to a distribution made in violation of section 7 106-401 or the articles of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating said section or the articles of…”
Alexander v. Anstine, 152 P.3d 497 (Colo. 2007).
“A 2006 amendment to the Colorado Revised Statutes, which does not apply to this case, states that directors and officers of corporations owe no fiduciary duties to the corporation's creditors.”
— Colo. Rev. Stat. § 7-108-401(l)(c) — 1 case
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