{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2026\/code-json\/13.1-691.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2026\/code-text\/13.1-691.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2026\/code-xml\/13.1-691.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2026\/code-html\/13.1-691.html"}],"law_id":346832,"edition_id":2,"section_id":346832,"structure_id":49791,"section_number":"13.1-691","catch_line":"Director conflict of interests","history":"Code 1950, \u00a7 13.1-39.1; 1975, c. 500; 1980, c. 341; 1985, c. 522; 2005, c. 765.","full_text":"A\n\nA conflict of interests transaction is a transaction with the corporation in which a director of the corporation has an interest that precludes the director from being a disinterested director. A conflict of interests transaction is not voidable by the corporation solely because of the director’s interest in the transaction if any one of the following is true:\n\n1\n\nThe material facts of the transaction and the director’s interest were disclosed or known to the board of directors or a committee of the board of directors and the board of directors or committee authorized, approved, or ratified the transaction;\n\n2\n\nThe material facts of the transaction and the director’s interest were disclosed to the shareholders entitled to vote and they authorized, approved, or ratified the transaction; or\n\n3\n\nThe transaction was fair to the corporation.\n\nB\n\nFor purposes of subdivision A 1, a conflict of interests transaction is authorized, approved, or ratified if it receives the affirmative vote of a majority of the disinterested directors on the board of directors, or on the committee. A transaction shall not be authorized, approved, or ratified under this section by a single director. If a majority of the disinterested directors vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director who is not disinterested does not affect the validity of any action taken under subdivision A 1 if the transaction is otherwise authorized, approved or ratified as provided in that subsection.\n\nC\n\nFor purposes of subdivision A 2, a conflict of interests transaction is authorized, approved, or ratified if it receives the vote of a majority of the shares entitled to be counted under this subsection. Shares owned by or voted under the control of a director who is not disinterested may not be counted in a vote of shareholders to determine whether to authorize, approve, or ratify a conflict of interests transaction under subdivision A 2. The vote of those shares, however, shall be counted in determining whether the transaction is approved under other sections of this chapter. A majority of the shares, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section.\n\n","order_by":null,"text":{"0":{"id":1293599,"text":"A conflict of interests transaction is a transaction with the corporation in which a director of the corporation has an interest that precludes the director from being a disinterested director. A conflict of interests transaction is not voidable by the corporation solely because of the director’s interest in the transaction if any one of the following is true:","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"A1"},"1":{"id":1293600,"text":"The material facts of the transaction and the director’s interest were disclosed or known to the board of directors or a committee of the board of directors and the board of directors or committee authorized, approved, or ratified the transaction;","type":"section","prefixes":["A","1"],"prefix":"1","entire_prefix":"A1","prefix_anchor":"A1","level":2,"prior_prefix":"A","next_prefix":"A2"},"2":{"id":1293601,"text":"The material facts of the transaction and the director’s interest were disclosed to the shareholders entitled to vote and they authorized, approved, or ratified the transaction; or","type":"section","prefixes":["A","2"],"prefix":"2","entire_prefix":"A2","prefix_anchor":"A2","level":2,"prior_prefix":"A1","next_prefix":"A3"},"3":{"id":1293602,"text":"The transaction was fair to the corporation.","type":"section","prefixes":["A","3"],"prefix":"3","entire_prefix":"A3","prefix_anchor":"A3","level":2,"prior_prefix":"A2","next_prefix":"B"},"4":{"id":1293603,"text":"For purposes of subdivision A 1, a conflict of interests transaction is authorized, approved, or ratified if it receives the affirmative vote of a majority of the disinterested directors on the board of directors, or on the committee. A transaction shall not be authorized, approved, or ratified under this section by a single director. If a majority of the disinterested directors vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director who is not disinterested does not affect the validity of any action taken under subdivision A 1 if the transaction is otherwise authorized, approved or ratified as provided in that subsection.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A3","next_prefix":"C"},"5":{"id":1293604,"text":"For purposes of subdivision A 2, a conflict of interests transaction is authorized, approved, or ratified if it receives the vote of a majority of the shares entitled to be counted under this subsection. Shares owned by or voted under the control of a director who is not disinterested may not be counted in a vote of shareholders to determine whether to authorize, approve, or ratify a conflict of interests transaction under subdivision A 2. The vote of those shares, however, shall be counted in determining whether the transaction is approved under other sections of this chapter. A majority of the shares, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B"}},"ancestry":[{"id":49791,"edition_id":2,"name":"Directors and Officers","identifier":"9","label":"article","depth":3,"order_by":11,"parent_id":49780,"metadata":{"child_laws":27,"child_structures":0},"date_created":"2026-08-02 02:15:20","date_modified":"2026-08-02 12:29:11","permalink":{"id":1378171,"object_type":"structure","relational_id":49791,"identifier":"9","token":"13.1\/9\/9","url":"\/13.1\/9\/9\/","edition_id":2,"permalink":0,"preferred":1}},{"id":49780,"edition_id":2,"name":"Virginia Stock Corporation Act","identifier":"9","label":"chapter","depth":2,"order_by":12,"parent_id":49726,"metadata":{"child_laws":265,"child_structures":27},"date_created":"2026-08-02 02:14:54","date_modified":"2026-08-02 12:29:09","permalink":{"id":1377165,"object_type":"structure","relational_id":49780,"identifier":"9","token":"13.1\/9","url":"\/13.1\/9\/","edition_id":2,"permalink":0,"preferred":1}},{"id":49726,"edition_id":2,"name":"Corporations","identifier":"13.1","label":"title","depth":1,"order_by":44,"parent_id":null,"metadata":{"child_laws":894,"child_structures":104},"date_created":"2026-08-02 02:14:01","date_modified":"2026-08-02 12:29:04","permalink":{"id":1374495,"object_type":"structure","relational_id":49726,"identifier":"13.1","token":"13.1","url":"\/13.1\/","edition_id":2,"permalink":0,"preferred":1}}],"structure_contents":[{"id":346811,"structure_id":49791,"section_number":"13.1-673","catch_line":"Requirement for and duties of board of directors","url":"\/13.1-673\/","token":"13.1\/9\/9\/13.1-673","metadata":false},{"id":346812,"structure_id":49791,"section_number":"13.1-674","catch_line":"Qualifications for directors or for nominees for director","url":"\/13.1-674\/","token":"13.1\/9\/9\/13.1-674","metadata":{"court_decisions":""}},{"id":346813,"structure_id":49791,"section_number":"13.1-675","catch_line":"Number and election of directors","url":"\/13.1-675\/","token":"13.1\/9\/9\/13.1-675","metadata":{"court_decisions":{"0":{"name":"In Re Old Grind Co., Inc.","case_number":"19-70170","citation":"99 B.R. 317","date":"1989-05-25","url":"https:\/\/www.courtlistener.com\/opinion\/2012268\/in-re-old-grind-co-inc\/","abstract":" .\u202f.\u202f. 99 B.R. 317 (1989) .\u202f.\u202f. ","court_html":"United States Bankruptcy Court, W.D. Virginia"}}}},{"id":346814,"structure_id":49791,"section_number":"13.1-676","catch_line":"Election of directors by certain classes or series of shares","url":"\/13.1-676\/","token":"13.1\/9\/9\/13.1-676","metadata":{"court_decisions":""}},{"id":346815,"structure_id":49791,"section_number":"13.1-677","catch_line":"Terms of directors generally","url":"\/13.1-677\/","token":"13.1\/9\/9\/13.1-677","metadata":false},{"id":346816,"structure_id":49791,"section_number":"13.1-678","catch_line":"Staggered terms for directors","url":"\/13.1-678\/","token":"13.1\/9\/9\/13.1-678","metadata":false},{"id":346817,"structure_id":49791,"section_number":"13.1-679","catch_line":"Resignation of directors","url":"\/13.1-679\/","token":"13.1\/9\/9\/13.1-679","metadata":false},{"id":346818,"structure_id":49791,"section_number":"13.1-680","catch_line":"Removal of directors by shareholders","url":"\/13.1-680\/","token":"13.1\/9\/9\/13.1-680","metadata":{"court_decisions":""}},{"id":346820,"structure_id":49791,"section_number":"13.1-681","catch_line":"Repealed","url":"\/13.1-681\/","token":"13.1\/9\/9\/13.1-681","metadata":false},{"id":346819,"structure_id":49791,"section_number":"13.1-681.1","catch_line":"Removal of directors by judicial proceeding","url":"\/13.1-681.1\/","token":"13.1\/9\/9\/13.1-681.1","metadata":false},{"id":346821,"structure_id":49791,"section_number":"13.1-682","catch_line":"Vacancy on board of directors","url":"\/13.1-682\/","token":"13.1\/9\/9\/13.1-682","metadata":false},{"id":346822,"structure_id":49791,"section_number":"13.1-683","catch_line":"Compensation of directors","url":"\/13.1-683\/","token":"13.1\/9\/9\/13.1-683","metadata":false},{"id":346823,"structure_id":49791,"section_number":"13.1-684","catch_line":"Meetings of the board of directors","url":"\/13.1-684\/","token":"13.1\/9\/9\/13.1-684","metadata":{"court_decisions":""}},{"id":346824,"structure_id":49791,"section_number":"13.1-685","catch_line":"Action without meeting of board of directors","url":"\/13.1-685\/","token":"13.1\/9\/9\/13.1-685","metadata":false},{"id":346825,"structure_id":49791,"section_number":"13.1-686","catch_line":"Notice of board of directors' meetings","url":"\/13.1-686\/","token":"13.1\/9\/9\/13.1-686","metadata":false},{"id":346826,"structure_id":49791,"section_number":"13.1-687","catch_line":"Waiver of notice by director","url":"\/13.1-687\/","token":"13.1\/9\/9\/13.1-687","metadata":false},{"id":346827,"structure_id":49791,"section_number":"13.1-688","catch_line":"Quorum and voting by directors","url":"\/13.1-688\/","token":"13.1\/9\/9\/13.1-688","metadata":false},{"id":346828,"structure_id":49791,"section_number":"13.1-689","catch_line":"Committees","url":"\/13.1-689\/","token":"13.1\/9\/9\/13.1-689","metadata":false},{"id":346830,"structure_id":49791,"section_number":"13.1-690","catch_line":"General standards of conduct for director","url":"\/13.1-690\/","token":"13.1\/9\/9\/13.1-690","metadata":{"court_decisions":{"0":{"name":" .\u202f.\u202f. 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Orr","case_number":"Record 080313.","citation":"673 S.E.2d 845","date":"2009-02-27","url":"https:\/\/www.courtlistener.com\/opinion\/1058372\/remora-investments-llc-v-orr\/","abstract":" .\u202f.\u202f. 673 S.E.2d 845 (2009) .\u202f.\u202f. ","court_html":"SCV<\/abbr>"},"3":{"name":"Willard v. Moneta Building Supply, Inc.","case_number":"Record 981836","citation":"515 S.E.2d 277","date":"1999-06-11","url":"https:\/\/www.courtlistener.com\/opinion\/1059739\/willard-v-moneta-building-supply-inc\/","abstract":" .\u202f.\u202f. JUSTICE KOONTZ, with whom JUSTICE HASSELL .\u202f.\u202f. ","court_html":"SCV<\/abbr>"},"4":{"name":"Wlr Foods, Inc. v. Tyson Foods, Inc.","case_number":"Civ. A. No. 94-0012-H","citation":"155 F.R.D. 136","date":"1994-04-25","url":"https:\/\/www.courtlistener.com\/opinion\/9045584\/wlr-foods-inc-v-tyson-foods-inc\/","abstract":" .\u202f.\u202f. MEMORANDUM OPINION .\u202f.\u202f. ","court_html":"District Court, W.D. Virginia"},"5":{"name":"Berman v. Physical Medicine Associates, Ltd.","case_number":"99-1043","citation":"225 F.3d 429","date":"2000-08-23","url":"https:\/\/www.courtlistener.com\/opinion\/2967261\/berman-v-physical-medicine-associates-ltd\/","abstract":" .\u202f.\u202f. Affirmed by published opinion. Judge NIEMEYER wrote the opinion, in which Judge MICHAEL and Judge .\u202f.\u202f. ","court_html":"Court of Appeals for the Fourth Circuit"},"6":{"name":"Matson v. Alpert (In re LandAmerica Financial Group, Inc.)","case_number":"Bankruptcy No. 08-35994; Adversary No. 11-03168","citation":"470 B.R. 759","date":"2012-03-01","url":"https:\/\/www.courtlistener.com\/opinion\/8522215\/matson-v-alpert-in-re-landamerica-financial-group-inc\/","abstract":" .\u202f.\u202f. MEMORANDUM OPINION .\u202f.\u202f. ","court_html":"United States Bankruptcy Court, E.D. Virginia"},"7":{"name":"WLR Foods, Inc. v. Tyson Foods, Inc.","case_number":"Civ. A. 94-012-H","citation":"857 F. 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The record of this law\u2019s original creation isn\u2019t available online. It has been modified 4 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1975, chapter 500; in 1980, chapter 341; in 1985, chapter 522; in 2005, chapter 765<\/a>.<\/p>","references":[{"id":346499,"section_number":"13.1-1229","catch_line":"Trustee standards of conduct; trustee liability; restrictions on liability limitations in governing instrument","order_by":null,"url":"\/13.1-1229\/"},{"id":346718,"section_number":"13.1-603","catch_line":"Definitions","order_by":null,"url":"\/13.1-603\/"},{"id":346745,"section_number":"13.1-619","catch_line":"Articles of incorporation","order_by":null,"url":"\/13.1-619\/"},{"id":346831,"section_number":"13.1-691.1","catch_line":"Business opportunities","order_by":null,"url":"\/13.1-691.1\/"},{"id":346904,"section_number":"13.1-729","catch_line":"Definitions","order_by":null,"url":"\/13.1-729\/"},{"id":346917,"section_number":"13.1-741.1","catch_line":"Limitations on other remedies for fundamental transactions","order_by":null,"url":"\/13.1-741.1\/"},{"id":346976,"section_number":"13.1-788","catch_line":"Standard of conduct for directors","order_by":null,"url":"\/13.1-788\/"}],"refers_to":false,"permalink":{"id":1378253,"object_type":"law","relational_id":346832,"identifier":"13.1-691","token":"13.1\/9\/9\/13.1-691","url":"\/13.1-691\/","edition_id":2,"permalink":0,"preferred":1},"url":"\/13.1-691\/","token":"13.1\/9\/9\/13.1-691","dublin_core":{"Title":"Director conflict of interests","Type":"Text","Format":"text\/html","Identifier":"\u00a7 13.1-691","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> A conflict of interests<\/span> transaction is a transaction with the corporation<\/span> in which a director of the corporation<\/span> has an interest<\/span> that precludes the director from being a disinterested director. A conflict of interests<\/span> transaction is not voidable by the corporation<\/span> solely because of the director’s interest<\/span> in the transaction if any one of the following is true: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The material<\/span> facts<\/span> of the transaction and the director’s interest<\/span> were disclosed or known to the board of directors or a committee of the board of directors and the board of directors or committee authorized, approved, or ratified the transaction; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The material<\/span> facts<\/span> of the transaction and the director’s interest<\/span> were disclosed to the shareholders<\/span> entitled to vote and they authorized, approved, or ratified the transaction; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The transaction was fair to the corporation<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> For purposes of subdivision A 1, a conflict of interests<\/span> transaction is authorized, approved, or ratified if it receives the affirmative vote of a majority of the disinterested directors on the board of directors, or on the committee. A transaction shall not be authorized, approved, or ratified under this section by a single director. If a majority of the disinterested directors vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director who is not disinterested does not affect the validity of any action taken under subdivision A 1 if the transaction is otherwise authorized, approved or ratified as provided in that subsection. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> For purposes of subdivision A 2, a conflict of interests<\/span> transaction is authorized, approved, or ratified if it receives the vote of a majority of the shares<\/span> entitled to be counted under this subsection. Shares<\/span> owned by or voted under the control of a director who is not disinterested may not be counted in a vote of shareholders<\/span> to determine whether to authorize, approve, or ratify a conflict of interests<\/span> transaction under subdivision A 2. The vote of those shares<\/span>, however, shall be counted in determining whether the transaction is approved under other sections of this chapter. A majority of the shares<\/span>, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nDIRECTOR CONFLICT OF INTERESTS (\u00a7 13.1-691)\n\nA. A conflict of interests transaction is a transaction with the corporation in\nwhich a director of the corporation has an interest that precludes the director\nfrom being a disinterested director. A conflict of interests transaction is not\nvoidable by the corporation solely because of the director’s interest in\nthe transaction if any one of the following is true:\n\n 1. The material facts of the transaction and the director’s interest\n were disclosed or known to the board of directors or a committee of the board\n of directors and the board of directors or committee authorized, approved, or\n ratified the transaction;\n\n 2. The material facts of the transaction and the director’s interest\n were disclosed to the shareholders entitled to vote and they authorized,\n approved, or ratified the transaction; or\n\n 3. The transaction was fair to the corporation.\n\nB. For purposes of subdivision A 1, a conflict of interests transaction is\nauthorized, approved, or ratified if it receives the affirmative vote of a\nmajority of the disinterested directors on the board of directors, or on the\ncommittee. A transaction shall not be authorized, approved, or ratified under\nthis section by a single director. If a majority of the disinterested directors\nvote to authorize, approve or ratify the transaction, a quorum is present for\nthe purpose of taking action under this section. The presence of, or a vote cast\nby, a director who is not disinterested does not affect the validity of any\naction taken under subdivision A 1 if the transaction is otherwise authorized,\napproved or ratified as provided in that subsection.\n\nC. For purposes of subdivision A 2, a conflict of interests transaction is\nauthorized, approved, or ratified if it receives the vote of a majority of the\nshares entitled to be counted under this subsection. Shares owned by or voted\nunder the control of a director who is not disinterested may not be counted in a\nvote of shareholders to determine whether to authorize, approve, or ratify a\nconflict of interests transaction under subdivision A 2. The vote of those\nshares, however, shall be counted in determining whether the transaction is\napproved under other sections of this chapter. A majority of the shares, whether\nor not present, that are entitled to be counted in a vote on the transaction\nunder this subsection constitutes a quorum for the purpose of taking action\nunder this section.\n\nHISTORY: Code 1950, \u00a7 13.1-39.1; 1975, c. 500; 1980, c. 341; 1985, c. 522;\n2005, c. 765.","edition":{"id":2,"name":"2026","slug":"2026","date_created":"2026-07-16 18:40:23","date_modified":"2026-08-02 15:14:36","current":1,"order_by":2,"last_import":"2026-08-02 12:37:30"}}