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§ 308B.465 Limitation Of Director's Liability

Statute text

Extracted from the Revisor of Statutes; first captured here October 15, 2026. Formatting and whitespace are normalized. Extraction can contain errors; the linked official text controls.

Subdivision 1. Articles may limit liability.

A director's personal liability to the cooperative or members for monetary damages for breach of fiduciary duty as a director may be eliminated or limited in the articles or bylaws except as provided in subdivision 2.

Subdivision 2. Restrictions on liability limitation.

The articles or bylaws may not eliminate or limit the liability of a director:

(1) for a breach of the director's duty of loyalty to the cooperative or its members;

(2) for acts or omissions that are not in good faith or involve intentional misconduct or a knowing violation of law;

(3) for knowing violations of securities laws or for illegal distributions;

(4) for a transaction from which the director derived an improper personal benefit; or

(5) for an act or omission occurring before the date when the provision in the articles or bylaws eliminating or limiting liability becomes effective.

History: 2003 c 105 art 1 s 35; 2006 c 196 art 1 s 52

Notes & interpretation Not part of the law

Verified against sources: October 15, 2026Last edited: October 16, 2026

In plain language#

A cooperative may write a liability shield for directors into its articles or bylaws: personal liability "to the cooperative or members for monetary damages for breach of fiduciary duty as a director may be eliminated or limited." P1, § 308B.465, subd. 1 The shield does not cover five categories (subd. 2):

  1. breach of the duty of loyalty to the cooperative or its members;
  2. acts or omissions not in good faith, or involving intentional misconduct or a knowing violation of law;
  3. knowing violations of securities laws or illegal distributions;
  4. a transaction from which the director derived an improper personal benefit; and
  5. acts or omissions before the effective date of the provision.

How it works in practice#

  • Nothing in the chapter makes the shield automatic. A cooperative that wants one must adopt the provision. The articles are the permanent home (§ 308B.215, § 308B.221); bylaws are easier to amend (§ 308B.241). Item 5 means a provision adopted later does not protect past conduct.
  • This section limits monetary damages liability. It is not the same as indemnification (reimbursement of expenses and judgments), which is covered in § 308B.471.
  • It also does not change the standard of conduct (§ 308B.455) or conflict-of-interest rules (§ 308B.461).

Sources

  • P1 Minnesota Statutes, Chapter 308B (Cooperative Associations), Office of the Revisor of Statutes, State of Minnesota. revisor.mn.gov (primary; accessed October 15, 2026)

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