Iowa Code 504.810 – Removal of directors by judicial proceeding
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1. The district court of the county where a corporation‘s principal office is located or if there is no principal office located in this state, where the registered office is located, may remove a director of the corporation from office in a proceeding commenced by or in the right of the corporation by a member or director if the court finds both of the following apply:
a. A director engaged in fraudulent conduct with respect to the corporation or its members, grossly abused the position of director, or intentionally inflicted harm on the corporation.
b. Upon consideration of the director’s course of conduct and the inadequacy of other available remedies, the court determines that removal is in the best interest of the corporation.
Terms Used In Iowa Code 504.810
- articles: includes amended and restated articles of incorporation and articles of merger. See Iowa Code 504.141
- Bylaws: means the code or codes of rules other than the articles adopted pursuant to this chapter for the regulation or management of the affairs of a corporation irrespective of the name or names by which such rules are designated. See Iowa Code 504.141
- Corporation: means a public benefit, mutual benefit, or religious corporation. See Iowa Code 504.141
- 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.
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Member: means a person who on more than one occasion, pursuant to the provisions of a corporation's articles or bylaws, has a right to vote for the election of a director or directors of a corporation, irrespective of how a member is defined in the articles or bylaws of the corporation. See Iowa Code 504.141
- Principal office: means the office in or out of this state so designated in the biennial report filed pursuant to section 504. See Iowa Code 504.141
- Proceeding: includes a civil suit and criminal, administrative, or investigatory actions. See Iowa Code 504.141
- Religious corporation: means a domestic or foreign corporation that engages in religious activity as one of the corporation's principal purposes. See Iowa Code 504.141
- state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
2. A member or a director who proceeds by or in the right of a corporation pursuant to subsection 1 shall comply with all of the requirements of section 504.631 and sections 504.633 through 504.638.
3. The court, in addition to removing a director, may bar the director from serving on the board for a period of time prescribed by the court.
4. This section does not limit the equitable powers of the court to order other relief that the court determines is appropriate.
5. The articles or bylaws of a religious corporation may limit or prohibit the application of this section.