Explain the requirements of the Duty of Care, the Duty of Loyalty, and the Business Judgment rule. Who or what are these duties designed to protect? Are these duties necessary? Why or why not? Use this week's lecture as a basis for your post.
Peppertree, Inc., hired Robert McClellan, a licensed contractor, to repair a condominium complex that was damaged in an earthquake. McClellan completes the work, but Peppertree fails to pay. McClellan is awarded $181,000 in an arbitration proceeding. Peppertree then forms another corporation and transfers all of its assets to the new corporation without notifying McClellan. Can McClellan hold Peppertree's shareholders personally liable for the debt? Why or why not?