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BUL 4310 PSU US Business Judgement Rule Discussion

I’m working on a business law writing question and need an explanation and answer to help me learn.

Locate the U.S. Business Judgment Rule

Then locate the rule in any other country.

Discuss the following:

1.   What part or parts of the U.S. rule do you either agree or disagree?
2.   Compare/contrast the U.S. with your selected country.  If they are the same, why do you think they are stated in similar ways.  If different, discuss the differences.

If you could change the U.S. rule, what would you change and why?

If you would not change anything in the U.S. rule, discuss what aspects of the rule you believe are most effective and why?

You MUST provide citations for all materials used.


I agree that the U.S business judgement rule does the right thing in holding the director/officer position at hand accountable for their actions as long as it is in good faith. Under Canadian corporate law, the business judgment rule is also an extension of enabling corporate statutes. In Canada it is not a law rather it is a presumption and the board of directors manage the business and affairs of a corporation. If there is no evidence of fraud, self dealing, or bad faith then the presumption applies. The appropriate standard for determining liability in Canadian cases is gross negligence, most of the time. It is basically the same but stated differently I assume due to the structure of their courts and culture. I agree if the director/officer position at hand does not act in a disinterested manner or breaches their loyalty to the company then they 100% should be held accountable, its the most effective in holding the person liable accountable it is fair for both parties. It is straight to the point no grey lines it is what it is, clear cut.


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