1996 Fiscal Year Final Research Report Summary
A study of the fiduciary duties of majority shareholder in U.S.A.
| Project/Area Number |
07620035
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Civil law
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| Research Institution | Hosei University |
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Principal Investigator |
SHIBATA Kazufumi Hosei University, Faculty of Law, Professor, 法学部, 教授 (30187398)
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| Project Period (FY) |
1995 – 1996
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| Keywords | Majority Shareholder / Minority Shareholder / Controlling Shareholder / Parent Corporation / Subsidiary / duty of loyalty / duty of disclosure / fiduciary duties |
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| Research Abstract |
It is well-established rule in American Corporation Law that the majority shareholders owe the fiduciary duties to the minority shareholders. Because the American Corporation Law is Case Law, we have to know more precisely about each of the case in order to understand the American Case Law exactly. This article researched the theoretical development of majority shareholders fiduciary duties.
When majority shareholder is a parent corporation, which transacted with its subsidiary corporation, in some cases court took parent corporation as fiduciary to the minority shareholders and at the same time to the subsidiary corporation. And then Court imposes the fiduciary duties on the majority shareholder, that is parent corporation. The earliest case, which the court recognized such duties, was Farmers' Loan & Trust Co. v. New York & Northern Railway Co., in 1896. In Southern Pacific Co. v. Bogert (1919), court recognized that the majority shareholders directly owe the fiduciary duty to the minority shareholders. In 1970's court began to recognize majority shareholders the duty of disclosure. In Lynch v. Vickers Energy Corp. (1977), the Supreme Court of Delaware held that the majority shareholders owe duty of disclosure as a part of fiduciary duty to minority shareholders.
This research is about how the Supreme Court of Delaware, established and developed the majority shareholder duty of disclosure as a part of majority shareholder fiduciary duty to the minority stockholder, especially in 1980' and 1990', by researching over hundreds of cases.
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