Business Judgment Rule in Florida
The business judgment rule is a legal presumption under Section 607.0831 that protects Florida corporate directors from personal liability for informed, good-faith business decisions made in the corporation's best interest.
Protection Scope
The rule shields directors who act in good faith, with the care of an ordinarily prudent person, in a manner reasonably believed to serve the corporation's interests. Directors who follow proper processes, inform themselves before deciding, and act without personal conflicts receive strong protection against shareholder second-guessing.
Exceptions
Protection does not extend to bad faith, self-dealing, gross negligence, illegal acts, or complete failure to exercise judgment. When directors breach these standards, the presumption falls away, and directors face personal liability for resulting losses. Breach of fiduciary duty claims then proceed without the rule's protection.
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Reviewed by the attorneys at Barnes Walker, Goethe, Shea & Robinson, PLLC