Huan is a shareholder of Insulation Inc.When the directors fail to undertake an action to redress a wrong suffered by the firm,Huan files a suit on its behalf.Any damages recovered by the suit will go to the firm's

Question

Quizplus · Accepted Answer

When Huan files a suit on behalf of the firm, any damages recovered by the suit will go to the firm's treasury, not the shareholders or the directors. The purpose of the suit is to redress the wrong suffered by the firm, not to benefit any individual shareholder or director. Therefore, the answer is option B, which states that the damages recovered will go to the firm's treasury.

Huan Is a Shareholder of Insulation Inc