Corporate Director and Shareholder Liability for Unlawful Distributions in Maine

At a glance

Requirements one by one

Director conduct and the corporation's excess claim

13-C M.R.S. § 833(1) makes a voting or assenting director liable to the corporation for the excess above what § 651(1) or the dissolved-corporation duty in § 1410(1) allows, if the claimant proves the director failed § 831 when acting. Section 831(1)-(2) requires good faith, a reasonable belief in corporate interests, and appropriate care. Section 831(4) permits qualified reliance on specified information, including financial data.

Contribution, recoupment, and recorded dissent

Under § 833(2), a liable director may seek contribution from every other director who could be liable and pro rata recoupment from each shareholder who knowingly accepted the unlawful amount. Section 825(4) presumes a present director assented unless the director timely objects, records dissent or abstention, or delivers written notice before or immediately after adjournment. A director voting in favor cannot use that route.

Primary and follow-on filing periods

Section 833(3) bars the director claim after two years from the § 651(5) or (7) measurement date, the date an articles restriction caused a § 651(1) violation, or the date assets were distributed under § 1410(1). Section 651(5) uses different dates for share acquisitions, debt distributions, and other payments; for the last category, authorization controls if payment occurs within 120 days, otherwise payment controls. Section 833(4) gives contribution and recoupment one year after final adjudication of the claimant director's liability.

What trips people up

Section 651(8) excludes liquidation distributions from the ordinary distribution test. Section 1410(1) instead requires a dissolved corporation's directors to pay or reasonably provide for claims before paying shareholders. Section 1410(2) protects directors regarding claims barred or satisfied through the specified dissolved-corporation claims process.

Common questions

Does a shareholder's receipt alone trigger recoupment?

No. Section 833(2)(B) requires that the shareholder knowingly accepted an amount made in violation of § 651(1) or § 1410(1).

Is the contribution deadline the same as the director-claim deadline?

No. Section 833(4) begins its one-year period after final adjudication of the claimant director's liability.

Statutes and sources

• 13-C M.R.S. § 102, accessed September 27, 2026: corporation and distribution definitions.
• 13-C M.R.S. § 651, accessed September 27, 2026: ordinary limits, dates, and liquidation exclusion.
• 13-C M.R.S. § 825, accessed September 27, 2026: presumed assent and dissent.
• 13-C M.R.S. § 831, accessed September 27, 2026: director conduct and reliance.
• 13-C M.R.S. § 833, accessed September 27, 2026: liability, contribution, recoupment, and filing periods.
• 13-C M.R.S. § 1410, accessed September 27, 2026: dissolved-corporation claims duty.