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Simple English definitions for legal terms

doctrine of adverse domination

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A quick definition of doctrine of adverse domination:

The Doctrine of Adverse Domination is a legal principle that states that the statute of limitations on a breach-of-fiduciary-duty claim against officers and directors of a corporation is paused as long as the corporation is controlled by the alleged wrongdoers. This means that the time limit for filing a claim is extended until a majority of the disinterested directors discover or are put on notice of the claim against the wrongdoers. The purpose of this doctrine is to prevent a director or officer from successfully hiding wrongful or fraudulent conduct during the limitations period. This doctrine is only available to benefit the corporation.

A more thorough explanation:

The Doctrine of Adverse Domination is an equitable principle that tolls the statute of limitations on a breach-of-fiduciary-duty claim against officers and directors, especially when a corporation sues its own officers and directors. This principle is applied when the corporate plaintiff is controlled by the alleged wrongdoers.

The statute of limitations is tolled until a majority of the disinterested directors discover or are put on notice of the claim against the wrongdoers. The purpose of this doctrine is to prevent a director or officer from successfully hiding wrongful or fraudulent conduct during the limitations period.

For example, if a corporation's CEO and board of directors engage in fraudulent activities that harm the corporation, the Doctrine of Adverse Domination can be applied to toll the statute of limitations until a majority of the disinterested directors discover or are put on notice of the wrongdoing. This allows the corporation to bring a claim against the wrongdoers even if the statute of limitations has expired.

It is important to note that this doctrine is only available to benefit the corporation and not the individual officers or directors.

doctrine of acquired rights | doctrine of approximation

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