FOSS V. HARBOTTLE
CASE SUMMARY: Two minority shareholders initiated legal proceedings against the director of the company. they claimed that the directors had misapplied the comapany's assets.
HELD: It was held that, company suffered any injury or losses, it alone can take action against the person who had misapplied the assets of company not other people. therefore, the members could not maintain such suit.
company may sue and can be sued in its own name.
court would not generally interfere with the decision of company which it was approved by the majority of members.
HOWEVER, in the process of implementing the objective of company, one should not override the legitimate expectations of minority shareholders