Connecticut General Statutes 33-757 – Liability for unlawful distribution
(a) A director who votes for or assents to a distribution made in violation of § 33-687 or subsection (a) of § 33-887b or the certificate of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating § 33-687 or subsection (a) of § 33-887b or the certificate of incorporation if it is established that he did not perform his duties in compliance with § 33-756 or subsection (a) of § 33-887b. In any proceeding commenced under this section, a director has all of the defenses ordinarily available to a director.
Terms Used In Connecticut General Statutes 33-757
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
(b) A director held liable under subsection (a) of this section for an unlawful distribution is entitled to contribution: (1) From every other director who could be held liable under subsection (a) of this section for the unlawful distribution; and (2) from each shareholder for the amount the shareholder accepted knowing the distribution was made in violation of § 33-687 or subsection (a) of § 33-887b or the certificate of incorporation.
(c) A proceeding under this section to enforce (1) the liability of a director under subsection (a) of this section is barred unless it is commenced within two years after the date (A) on which the effect of the distribution was measured under subsection (e) or (g) of § 33-687, (B) as of which a violation of subsection (a) of § 33-687 occurred as a consequence of disregarding a restriction in the certificate of incorporation, or (C) on which the distribution of assets to shareholders was made under subsection (a) of § 33-887b; or (2) contribution or recoupment under subsection (b) of this section is barred unless it is commenced within one year after the liability of the claimant has been finally adjudicated under subsection (a) of this section.
(d) For purposes of this section, a director shall be deemed to have voted for a distribution if such director was present at the meeting of the board of directors or committee thereof at the time such distribution was authorized and did not vote in dissent therefrom, or if such director consented thereto pursuant to § 33-749.