Florida Statutes
Fla. Stat. § 607.0834 (2025)
Liability for unlawful distributions.
✓ 2025 Florida Statutes — current through the 2025 Regular Session
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607.0834 Liability for unlawful distributions.—
(1) A director who votes for or assents to a distribution made in violation of s. 607.06401, s. 607.1410(1), 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 s. 607.06401, s. 607.1410(1), or the articles of incorporation if it is established that the director did not perform his or her duties in compliance with s. 607.0830. In any proceeding commenced under this section, a director has all of the defenses ordinarily available to a director.
(2) A director held liable under subsection (1) for an unlawful distribution is entitled to contribution:
(a) From every other director who could be liable under subsection (1) for the unlawful distribution; and
(b) From each shareholder for the amount the shareholder accepted knowing the distribution was made in violation of s. 607.06401 or the articles of incorporation.
(3) A proceeding under this section is barred unless it is commenced:
(a) Within 2 years after the date on which the effect of the distribution was measured under s. 607.06401(6) or (8);
(b) Within 2 years after the date as of which the violation of s. 607.06401 occurred as the consequence of disregard of a restriction in the articles of incorporation;
(c) Within 2 years after the date on which the distribution of assets to shareholders under s. 607.1410(1) was made; or
(d) With regard to contribution or recoupment under subsection (2), within 1 year after the liability of the claimant has been finally adjudicated under subsection (1).
Notes of Decisions
Cited in 2
cases, 2001–2008 · leading case: Miller v. McDonald (In Re World Health Alternatives, Inc.), 385 B.R. 576 (Bankr. D. Del. 2008).
Miller v. McDonald (In Re World Health Alternatives, Inc.), 385 B.R. 576 (Bankr. D. Del. 2008). “judgment or adjudication to be material to the cause of action and constituted (i)a violation of criminal law, unless the person reasonably believed the conduct was lawful or had no reasonable cause to believe it was unlawful; (ii) a transaction in which the person derived an…”
Jesson, Inc. v. Sutton Hill Assocs., Inc., 789 So. 2d 1064 (Fla. 4th DCA 2001). “fraudulently divested itself of its assets to the detriment of one of its *1067 creditors, Plaintiff, Sutton Hill Associates.”
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