Betty is a director of the Good Thunder Corporation.Good Thunder wants to buy a tract of land on which to build a new factory.Betty owns such a tract of land,and sells it to Good Thunder without disclosing that she owns the land.Betty is paid the fair market value of the land.Betty's action is best described as which of the following?

Question

Quizplus · Accepted Answer

Betty's action is a clear violation of the duty prohibiting self-dealing, which requires directors to act in the best interests of the corporation and not use their position to further their own personal interests. By selling her own land to the corporation without disclosing her ownership, Betty put her own financial interests ahead of those of the corporation. Even though she was paid fair market value for the land, her failure to disclose her ownership created a conflict of interest that violated her duty to act in the best interests of the corporation.

Betty Is a Director of the Good Thunder Corporation