Practice question
A disinterested board compares lawful restructuring alternatives, obtains required approvals and chooses an asset-light operating model in good faith. A shareholder seeks injunction solely because she believes ownership of more equipment is wiser; all alleged illegality and bad faith are stipulated absent. Which is correct?
- The court must become the corporation’s purchasing department
- Any minority preference necessarily defeats board authority
- All restructurings are automatically unlawful
- The stated strategic disagreement alone does not justify judicial substitution for the authorized honest policy choice.
- The doctrine proves every future contract valid automatically
Legal references
- Montelibano v. Bacolod-Murcia Milling Co., G.R. No. L-15092, May 18, 1962, main decision: https://www.lawphil.net/judjuris/juri1962/may1962/gr_l-15092_1962.html
- Teng v. Teng, G.R. No. 277015, February 17, 2025, main decision: https://lawphil.net/judjuris/juri2025/feb2025/gr_277015_2025.html
- Revised Corporation Code, RA 11232, Sections 22, 30 and 61: https://lawphil.net/statutes/repacts/ra2019/ra_11232_2019.html
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