Ultra vires activities

(redirected from Ultra Vires Act)

Ultra vires activities

Corporate actions and operations that are not sanctioned by corporate charter, sometimes leading to shareholder lawsuits.

Ultra Vires Activities

Activities in which a publicly-traded company engages that are outside the powers delegated to it in its charter and/or bylaws. Every publicly-traded company has a charter and bylaws, which both outline the powers of executives and the board of directors and actions they are allowed to take. While both the charter and the bylaws can be amended by shareholders, companies sometimes take actions outside the scope of their charters without first receiving permission to do so. If shareholders deem ultra vires activities to be harmful to them or to have the potential of harm, they may sue the company for damages.
Mentioned in ?
References in periodicals archive ?
17, 2013 was an ultra vires act and has no legal value because a prosecutor had put himself in the position of a judge.
An ultra vires act is defined as one beyond the scope of one's legal authority or power.
This may result in a remedy available for an individual adversely affected by the ultra vires act.
73] In addition, Israel's changing of local law to make water a public commodity may also classify as an ultra vires act under Article 43, which requires an occupant to take measures necessary for ensuring public order and civil life while "respecting the laws in force" prior to the occupation "unless absolutely prevented.
The Board of Directors views the execution of the agreements as being an ultra vires act.
180) Although voting restrictions persisted as the norm in consumer cooperatives' law and practice, the courts' willingness to police ultra vires acts in cooperatives faded just as it did with respect to business corporations.
1979) (denying standing and dismissing case brought by donor alleging ultra vires acts, self-dealing, and breach of fiduciary duty against a hospital and its directors).