Nonprofit Director Conflict Transaction Approval Rules in Idaho
At a glance
| Governing act and covered transactions | Idaho Nonprofit Corporation Act; corporation transaction involving director (§ 30-30-619(1)) |
|---|---|
| Interest and related-person trigger | Direct/indirect director interest; material-interest/general-partner or director/officer/trustee role in another party (§ 30-30-619(1), (3)) |
| Disclosure and knowledge | Material transaction and director-interest facts disclosed or known to board/committee or members (§ 30-30-619(2)) |
| Board or committee approval | Majority of board/committee directors without direct/indirect interest; § 30-30-619(4) states no single-director ban |
| Member approval and vote | Informed members; majority of countable votes; interested director and specified entity-controlled votes excluded (§ 30-30-619(2)(b), (5)) |
| Fairness route and time | Fair to corporation when entered into is independent protection (§ 30-30-619(1)) |
| Interested participation and quorum | Disinterested board majority supplies conflict-action quorum; interested presence/vote does not defeat compliant action (§ 30-30-619(4)) |
| Burden, effect, and separate authorization | Not voidable or basis for director liability; excluded member votes still count under other act sections (§ 30-30-619(1), (5)) |
| Special coverage and later changes | Articles, bylaws, or board resolution may add conflict requirements (§ 30-30-619(6)) |
Requirements one by one
Direct and indirect interests
Under § 30-30-619(3), an indirect interest includes a transaction with another party entity in which the director has a material interest or is a general partner. It also includes an entity where the director is a director, officer, or trustee. Section 30-30-619(1) protects a qualifying transaction from voidability or director liability; fairness is judged when the transaction was entered into.
Informed approval
Section 30-30-619(2) requires disclosure or knowledge of material facts about both the transaction and the director's interest for its approval routes. Subsection (4) counts a majority of directors without direct or indirect interest on the board or committee. For members, subsection (5) counts a majority of eligible votes after its stated exclusions.
What trips people up
The member conflict tally under § 30-30-619(5) excludes votes cast by or controlled by an interested director or an entity in which the director has a material interest or is a general partner. Those votes still count for approvals under other sections of the act. A disinterested board majority supplies the conflict-action quorum under subsection (4), and interested presence or votes do not invalidate a compliant board action. Articles, bylaws, or a board resolution can impose additional conflict requirements under subsection (6).
Common questions
May approval occur after the transaction?
Section 30-30-619(2) permits the board, committee, or members to authorize, approve, or ratify under its conditions. The separate fairness route in subsection (1) looks to when the transaction was entered into.
Is a one-director conflict approval prohibited?
Section 30-30-619(4) requires a majority of disinterested directors on the board or committee; it does not state a separate ban on approval by one director. Whether one director constitutes that majority depends on the disinterested decisionmakers for the actual board or committee.
Statutes and sources
- Idaho Code § 30-30-619(1)–(6): director interest, approval, votes, fairness, effect, and additional requirements. Official section, accessed 2026-10-02.
Source links
Every statute quoted above, linked, with the date we checked it.
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