Fact Pattern 30-1
Ray is a shareholder of Small Biz Company (SBC). When the directors fail to undertake an action to redress a wrong suffered by SBC, Ray files a suit on the firm's behalf.
-Refer to Fact Pattern 30-1. Any damages recovered by Ray's suit will go to

Question

Quizplus · Accepted Answer

Any damages recovered by Ray's suit will go to SBC, as he filed the suit on the firm's behalf to redress the wrong suffered by SBC. As a shareholder, Ray only has a derivative claim and does not have a personal claim to damages. The damages are meant to compensate the company for the harm suffered. Therefore, the damages recovered will be awarded to SBC, not to Ray or anyone else.

Fact Pattern 30-1 Ray Is a Shareholder of Small Biz Company (SBC). When