Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 133 (2019GS)

Sponsor

Sen. Cullimore, K. A.

Final action

Governor Signed 3/25/2019

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• defines terms;
• creates a cause of action for oppressive conduct toward a shareholder of a closely held corporation; and
• establishes a remedy.

Every vote on this bill

Bill text

OPPRESSIVE CONDUCT IN A CLOSELY HELD
CORPORATION
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Kirk A. Cullimore
House Sponsor: 
Steve Waldrip
LONG TITLE
General Description:
This bill establishes a cause of action for oppressive conduct in a closely held
corporation.
Highlighted Provisions:
This bill:
▸ defines terms;
▸ creates a cause of action for oppressive conduct toward a shareholder of a closely
held corporation; and
▸ establishes a remedy.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
ENACTS:
16-10a-1901
, Utah Code Annotated 1953
16-10a-1902
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
16-10a-1901
 is enacted to read:
Part 19. Oppressive Conduct in a Closely Held Corporation
 16-10a-1901.
Definition.
As used in this part:
(1) "Oppressive conduct" means a continuing course of conduct, a significant action, or
a series of actions that substantially interferes with the interests of a shareholder as a
shareholder.
(2) "Oppressive conduct" may include:
(a) termination of a shareholder's employment; or
(b) limitations on a shareholder's employment benefits to the extent that the limitations
interfere with distributions or other shareholder interests disproportionately as to the affected
shareholder.
(3) "Oppressive conduct" does not include an action allowed by an agreement, the
corporation's articles of incorporation, the corporation's bylaws, or a consistently applied
written corporate policy or procedure.
Section 2. Section 
16-10a-1902
 is enacted to read:
 16-10a-1902.
Shareholder cause of action -- Relief.
(1) A shareholder of a closely held corporation who is injured by oppressive conduct
may bring a private cause of action against the closely held corporation.
(2) (a) If a court finds that oppressive conduct toward the shareholder occurred, the
court shall order one or more persons described in Subsection (2)(b) to purchase the injured
shareholder's shares in the closely held corporation at fair value.
(b) A court may order that any of the following purchase the shares of the shareholder
as described in Subsection (2)(a):
(i) the closely held corporation;
(ii) an officer of the closely held corporation;
(iii) a director of the closely held corporation; or
(iv) a shareholder of the closely held corporation that is responsible for the oppressive
conduct.