Brad is a shareholder of Cloud Servers Inc. He will be deemed to have a fiduciary duty to Cloud and its minority shareholders if he has a sufficient number of shares to

Question

Brad is a shareholder of Cloud Servers Inc. He will be deemed to have a fiduciary duty to Cloud and its minority shareholders if he has a sufficient number of shares to​

Quizplus · Accepted Answer

A fiduciary duty is imposed on shareholders who have sufficient control over a corporation that enables them to dominate its decision-making process. This level of control is known as de facto control, and it implies that the shareholder has the power to dictate how the corporation operates. Therefore, if Brad has the ability to exercise de facto control over Cloud Servers Inc., he will be subject to a fiduciary duty to Cloud and its minority shareholders. The other options listed (A, B, and D) are not necessarily indicative of a shareholder having control over a corporation or being subject to a fiduciary duty.

Brad Is a Shareholder of Cloud Servers Inc