Corporate Interested-Director Transaction Requirements in Idaho

At a glance

Requirements one by one

The defined interest and qualification tests serve different purposes

Idaho Code § 30-29-860 asks whether the director was a party, had the specified known financial interest, or knew of the related person’s party status or interest at the relevant time. Section 30-29-143 separately excludes a director with that conflict or a material relationship to another conflicted director from the qualified approval group. Shared board service or nomination by a nonqualified director does not automatically defeat qualification.

Disclosure includes material transaction facts

Section 30-29-860(7) includes both the existence and nature of the conflict and all known transaction facts a conflict-free director would reasonably consider material. Section 30-29-862(a) requires the conflicted director to supply facts not already known to the qualified directors who act.

Qualified approval counts voters differently from quorum

Section 30-29-862 requires a majority of qualified directors who vote, with at least two affirmative votes. Quorum instead uses all qualified directors on the board or committee, also with a two-director floor. If five are qualified, three form quorum; if three vote, two affirmative votes satisfy the special approval threshold. Other directors cannot join this deliberation or vote.

Shareholder voting follows notice and a written holder report

Section 30-29-863 requires notice of the action, communication of required facts not already known, and the conflicted director’s written report of known nonqualified shares and their holders to the vote tabulator. The meeting voters are determined as of the notice record date. Record, beneficial, and unrestricted voting-trust beneficial owners all fall within the holder rule.

The fairness alternative examines the whole transaction

Sections 30-29-860(3), (6) and 30-29-861(b)(3) require established fairness at the specified relevant time. Fairness considers overall corporate benefit, the director’s dealings, and arm’s-length comparability for the consideration. Relevant time is qualifying board action or, absent it, when the corporation or controlled entity becomes legally obligated to consummate the transaction.

Written board action is completed by delivery

Section 30-29-821 requires each director’s signed consent and delivery to the corporation unless the articles or bylaws require a meeting. The consent may specify a later effective time, and a signed revocation delivered before the complete unrevoked set arrives withdraws consent. This general procedure does not state an exemption from the conflict procedure’s separate requirements.

Opportunities and compensation have separate text

Section 30-29-811 allows board-set director compensation unless articles or bylaws say otherwise. Section 30-29-870 separately reaches directors and officers pursuing opportunities directly or indirectly and provides informed precommitment disclaimer and compliant articles-based limitation routes. Neither is a general controlling-stockholder transaction procedure.

The remedy bar is tied to the interest ground

Section 30-29-861 addresses the specified equitable relief, damages, and sanctions against a director in shareholder or corporate proceedings on the ground of the director’s transaction interest. It also addresses transactions outside the defined conflict category. Section 30-29-1601 requires shareholder, board, and board-committee meeting minutes and no-meeting action records, maintained so they can be made available for inspection within a reasonable time.

What trips people up

The board confidentiality exception in § 30-29-862(b) refers to § 30-29-860(3)(e) or (f), but the current definitions place related persons in subsection (5); subsection (3) defines fairness. The mismatch should be reviewed before relying on modified disclosure. This page does not replace the printed cross-reference with an assumed correction.

The current § 30-29-863(c)(2) expressly identifies the employer branch at § 30-29-860(5)(f) as excepted from the related-person share exclusion.

Conflict protection and ordinary authorization remain separate. Sections 30-29-862(d) and 30-29-863(f) require independent action when another law or governing record requires it, and allow nonqualified directors or shares to participate in that independent action. Nonqualified-share presence or voting does not itself defeat an otherwise compliant qualified-share vote.

Common questions

Can a court address a missing written share report?

Under § 30-29-863(e), the court has discretion if reporting is the only defect and the director establishes the failure was neither intended to influence nor determinative of the vote. Protection is not automatic.

Can the qualifying approval occur after the transaction?

Section 30-29-861(b)(1)-(2) permits qualifying director or shareholder action “at any time,” subject to the disclosure and procedural conditions.

Does not using the opportunity disclaimer establish a breach?

Section 30-29-870(b) says that omission creates no implication that the opportunity should first have been presented to the corporation and does not alter the otherwise-applicable burden of proof.

Statutes and sources

All official texts below were accessed September 4, 2026.

• Idaho Code § 30-29-143 — Official text: “30-29-143. QUALIFIED DIRECTOR. (a) A "qualified director" is a director who, at the time action is to be taken under: (1) Section 30-29-202(b)(6), Idaho Code, is not a director to whom the limitation or elimination of the duty of an officer to offer potential business opportunities to the corporation would apply or who has a material relationship with any other person to whom the limitation or elimination would apply; (2) Section 30-29-744, Idaho Code, does not have a material interest in the outcome of the proceeding or a material relationship with a person who has such an interest; (3) Section 30-29-853 or 30-29-855, Idaho Code, is not a party to the proceeding, is not a director as to whom a transaction is a director's conflicting interest transaction or who sought a disclaimer of the corporation's interest in a business opportunity under section 30-29-870, Idaho Code, which transaction or disclaimer is challenged in the proceeding, and does not have a material relationship with a director described in this subsection; (4) Section 30-29-862, Idaho Code, is not a director as to whom the transaction is a director's conflicting interest transaction or who has a material relationship with another director as to whom the transaction is a director's conflicting interest transaction; or (5) Section 30-29-870, Idaho Code, is not a director who pursues or takes advantage of the business opportunity, directly or indirectly through or on behalf of another person or has a material relationship with a director or officer who pursues or takes advantage of the business opportunity, directly or indirectly through or on behalf of another person. (b) For purposes of this section: (1) "Material interest" means an actual or potential benefit or detriment, other than one which would devolve on the corporation or the shareholders generally, that would reasonably be expected to impair the objectivity of the director's judgment when participating in the action to be taken; and (2) "Material relationship" means a familial, financial, professional, employment, or other relationship that would reasonably be expected to impair the objectivity of the director's judgment when participating in the action to be taken. (c) The presence of one (1) or more of the following circumstances shall not automatically prevent a director from being a qualified director: (1) Nomination or election of the director to the current board by any director who is not a qualified director with respect to the matter, or by any person who has a material relationship with that director, acting alone or participating with others; (2) Service as a director of another corporation of which a director who is not a qualified director with respect to the matter, or any individual who has a material relationship with that director, is or was also a director; or (3) With respect to action to be taken under section 30-29-744, Idaho Code, status as a named defendant, as a director against whom action is demanded, or as a director who approved the conduct being challenged.”

• Idaho Code § 30-29-811 — Official text: “30-29-811. COMPENSATION OF DIRECTORS. Unless the articles of incorporation or bylaws provide otherwise, the board of directors may fix the compensation of directors.”

• Idaho Code § 30-29-821 — Official text: “30-29-821. ACTION WITHOUT MEETING. (a) Except to the extent that the articles of incorporation or bylaws require that action by the board of directors be taken at a meeting, action required or permitted by this chapter to be taken by the board of directors may be taken without a meeting if each director signs a consent describing the action to be taken and delivers it to the corporation. (b) Action taken under this section is the act of the board of directors when one (1) or more consents signed by all the directors are delivered to the corporation. The consent may specify a later time as the time at which the action taken is to be effective. A director's consent may be withdrawn by a revocation signed by the director and delivered to the corporation before delivery to the corporation of unrevoked written consents signed by all the directors. (c) A consent signed under this section has the effect of action taken at a meeting of the board of directors and may be described as such in any document.”

• Idaho Code § 30-29-860 — Official text: “30-29-860. DEFINITIONS. As used in sections 30-29-860 through 30-29- 863, Idaho Code: (1) "Control" or "controlled by" means having the power, directly or indirectly, to elect or remove a majority of the members of the board of directors or other governing body of an entity, whether through the ownership of voting shares or interests, by contract, or otherwise; or being subject to a majority of the risk of loss from the entity's activities or entitled to receive a majority of the entity's residual returns. (2) "Director's conflicting interest transaction" means a transaction effected or proposed to be effected by the corporation, or by an entity controlled by the corporation, where at the relevant time the director is a party, had knowledge and a material financial interest known to the director, or knew that a related person was a party or had a material financial interest. (3) "Fair to the corporation" means, for purposes of section 30-29-861(b)(3), Idaho Code, that the transaction as a whole was beneficial to the corporation, taking into appropriate account whether it was fair in terms of the director's dealings with the corporation, and comparable to what might have been obtainable in an arm's length transaction, given the consideration paid or received by the corporation. (4) "Material financial interest" means a financial interest in a transaction that would reasonably be expected to impair the objectivity of the director's judgment when participating in action on the authorization of the transaction. (5) "Related person" means: (a) The individual's spouse; (b) A child, stepchild, grandchild, parent, stepparent, grandparent, sibling, stepsibling, half-sibling, aunt, uncle, niece, or nephew, or spouse of any such person, of the individual or of the individual's spouse; (c) A natural living person living in the same house as the individual; (d) An entity, other than the corporation or an entity controlled by the corporation, controlled by the individual or any person specified in this subsection; (e) A domestic or foreign business or nonprofit corporation, other than the corporation or an entity controlled by the corporation, of which the individual is a director; an unincorporated entity of which the individual is a general partner or a member of the governing body; or an individual, trust, or estate for whom, or of which, the individual is a trustee, guardian, personal representative, or like fiduciary; or (f) A person that is, or an entity that is controlled by, an employer of the individual. (6) "Relevant time" means the time at which directors' action respecting the transaction is taken in compliance with section 30-29-862, Idaho Code; or if the transaction is not brought before the board of directors, or a committee, for action under section 30-29-862, Idaho Code, at the time the corporation, or an entity controlled by the corporation, becomes legally obligated to consummate the transaction. (7) "Required disclosure" means disclosure of the existence and nature of the director's conflicting interest and all facts known to the director respecting the subject matter of the transaction that a director free of such conflicting interest would reasonably believe to be material in deciding whether to proceed with the transaction.”

• Idaho Code § 30-29-861 — Official text: “30-29-861. JUDICIAL ACTION. (a) A transaction effected or proposed to be effected by the corporation or by an entity controlled by the corporation may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation, on the grounds that the director has an interest, respecting the transaction if it is not a director's conflicting interest transaction. (b) A director's conflicting interest transaction may not be the subject of equitable relief or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation, on the grounds that the director has an interest respecting the transaction, if: (1) Directors' action respecting the transaction was taken in compliance with section 30-29-862, Idaho Code, at any time; (2) Shareholders' action respecting the transaction was taken in compliance with section 30-29-863, Idaho Code, at any time; or (3) The transaction, judged according to the circumstances at the relevant time, is established to have been fair to the corporation.”

• Idaho Code § 30-29-862 — Official text: “30-29-862. DIRECTORS' ACTION. (a) Directors' action respecting a director's conflicting interest transaction is effective for purposes of section 30-29-861(b)(1), Idaho Code, if the transaction has been authorized by the affirmative vote of a majority, but no fewer than two (2), of the qualified directors who voted on the transaction after required disclosure by the conflicted director of information not already known by such qualified directors, or after modified disclosure in compliance with subsection (b) of this section; provided that: (1) The qualified directors have deliberated and voted outside the presence of and without the participation by any other director; and (2) Where the action has been taken by a board committee, all members of the committee were qualified directors, and either the committee was composed of all the qualified directors on the board of directors, or the members of the committee were appointed by the affirmative vote of a majority of the qualified directors on the board of directors. (b) Notwithstanding the provisions of subsection (a) of this section, when a transaction is a director's conflicting interest transaction, only because a related person described in section 30-29-860(3)(e) or (f), Idaho Code, is a party to or has a material financial interest in the transaction, the conflicted director is not obligated to make required disclosure to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule, provided that the conflicted director discloses to the qualified directors voting on the transaction: (1) All information required to be disclosed that is not so violative; (2) The existence and nature of the director's conflicting interest; and (3) The nature of the conflicted director's duty not to disclose the confidential information. (c) A majority, but no fewer than two (2), of all the qualified directors on the board of directors, or on the board committee, constitutes a quorum for purposes of action that complies with this section. (d) Where directors' action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the articles of incorporation or bylaws or a provision of law, independent action to satisfy those authorization requirements shall be taken by the board of directors or a board committee, in which action directors who are not qualified directors may participate.”

• Idaho Code § 30-29-863 — Official text: “30-29-863. SHAREHOLDERS' ACTION. (a) Shareholders' action respecting a director's conflicting interest transaction is effective for purposes of section 30-29-861(b)(2), Idaho Code, if a majority of the votes cast by the holders of all qualified shares are in favor of the transaction after: (1) Notice to shareholders describing action to be taken respecting the transaction; (2) Provision to the corporation of the information referred to in subsection (b) of this section; and (3) Communication to the shareholders entitled to vote on the transaction of the information that is the subject of required disclosure, to the extent the information is not known by them. In the case of shareholders' action at a meeting, the shareholders entitled to vote shall be determined as of the record date for notice of the meeting. (b) A director who has a conflicting interest respecting the transaction shall, before the shareholders' vote, inform the secretary, or other officer or agent of the corporation authorized to tabulate votes, in writing, of the number of shares that the director knows are not qualified shares under subsection (c) of this section, and the identity of the holders of those shares. (c) As used in this section: (1) "Holder" means and "held by" refers to shares held by a record shareholder, a beneficial shareholder, and an unrestricted voting trust beneficial owner; and (2) "Qualified shares" means all shares entitled to be voted with respect to the transaction except for shares that the secretary or other officer or agent of the corporation authorized to tabulate votes either knows, or under subsection (b) of this section is notified, are held by either a director who has a conflicting interest respecting the transaction or a related person of the director, not including a person described in section 30-29-860(5)(f), Idaho Code. (d) A majority of the votes entitled to be cast by the holders of all qualified shares constitutes a quorum for purposes of compliance with this section. Subject to the provisions of subsection (e) of this section, shareholders' action that otherwise complies with this section is not affected by the presence of holders or by the voting of shares that are not qualified shares. (e) If a shareholders' vote does not comply with subsection (a) of this section solely because of a director's failure to comply with subsection (b) of this section, and if the director establishes that the failure was not intended to influence, and did not in fact determine, the outcome of the vote, the court may take such action respecting the transaction and the director, and may give such effect, if any, to the shareholders' vote, as the court considers appropriate in the circumstances. (f) Where shareholders' action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the articles of incorporation or the bylaws or a provision of law, independent action to satisfy those authorization requirements shall be taken by the shareholders, in which action shares that are not qualified shares may participate.”

• Idaho Code § 30-29-870 — Official text: “30-29-870. BUSINESS OPPORTUNITIES. (a) If a director or officer pursues or takes advantage of a business opportunity directly, or indirectly through or on behalf of another person, that action may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against the director, officer, or other person, in a proceeding by or in the right of the corporation on the ground that the opportunity should have first been offered to the corporation, if: (1) Before the director, officer, or other person becomes legally obligated respecting the opportunity, the director or officer brings it to the attention of the corporation and either: (i) Action by qualified directors disclaiming the corporation's interest in the opportunity is taken in compliance with the same procedures as are set forth in the provisions of section 30-29- 862, Idaho Code; or (ii) Shareholders' action disclaiming the corporation's interest in the opportunity is taken in compliance with the procedures set forth in the provisions of section 30-29-863, Idaho Code, in either case as if the decision being made concerned a director's conflicting interest transaction, except that, rather than making the required disclosure as defined in section 30-29-860, Idaho Code, the director or officer shall have made prior disclosure to those acting on behalf of the corporation of all material facts concerning the business opportunity known to the director or officer; or (2) The duty to offer the corporation the business opportunity has been limited or eliminated pursuant to a provision of the articles of incorporation adopted, and where required, made effective by action of qualified directors, in accordance with the provisions of section 30-29- 202(b)(6), Idaho Code. (b) In any proceeding seeking equitable relief or other remedies based upon an alleged improper pursuit or taking advantage of a business opportunity by a director or officer, directly, or indirectly through or on behalf of another person, the fact that the director or officer did not employ the procedure described in paragraph (i) or (ii) of subsection (a)(1) of this section before pursuing or taking advantage of the opportunity shall not create an implication that the opportunity should have been first presented to the corporation or alter the burden of proof otherwise applicable to establish that the director or officer breached a duty to the corporation in the circumstances.”

• Idaho Code § 30-29-1601 — Official text: “30-29-1601. CORPORATE RECORDS. (a) A corporation shall maintain the following records: (1) Its articles of incorporation as currently in effect; (2) Any notices to shareholders referred to in section 30-29- 120(d)(5), Idaho Code, specifying facts on which a filed document is dependent if those facts are not included in the articles of incorporation or otherwise available as specified in section 30-29-120(d)(5), Idaho Code; (3) Its bylaws currently in effect; (4) All written communications within the past three (3) years to shareholders generally; (5) Minutes of all meetings of, and records of all actions taken without a meeting by, its shareholders, its board of directors, and board committees established under section 30-29-825, Idaho Code; (6) A list of the names and business addresses of its current directors and officers; and (7) Its most recent annual report delivered to the secretary of state pursuant to section 30-21-213, Idaho Code. (b) A corporation shall maintain all annual financial statements prepared for the corporation for its last three (3) fiscal years, or such shorter period of existence, and any audit or other reports with respect to such financial statements. (c) A corporation shall maintain accounting records in a form that permits preparation of its financial statements. (d) A corporation shall maintain a record of its current shareholders in alphabetical order by class or series of shares showing the number and class or series of shares held by each shareholder. Nothing contained in this subsection shall require the corporation to include in such record the electronic mail address or other electronic contact information of a shareholder. (e) A corporation shall maintain the records specified in this section in a manner so that they may be made available for inspection within a reasonable time.”