Senate Bill No. 126

SPONSOR: Sen. Vaughn & Rep. Wagner;
Reps. George, Plant, Valihura

 

DELAWARE STATE SENATE
142nd GENERAL ASSEMBLY
SENATE BILL NO. 126

 

AN ACT TO AMEND TITLE 10 OF THE DELAWARE CODE RELATING TO COURTS AND JUDICIAL PROCEDURE.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:

Section 1. Amend the title of Section 3114, Title 10, Delaware Code, by replacing the word “or” after the word “trustees” with a comma, and by adding the words “or officers” after the word “body”.

Section 2. Amend Section 3114(a), Title 10, Delaware Code, by inserting a comma after the first appearance of the word “capacity” in the first sentence thereof.

Section 3. Amend Section 3114, Title 10, Delaware Code, by redesignating subsections (b), (c), (d) and (e) thereof as subsections (c), (d), (e) and (f), respectively, and by adding a new subsection (b) as follows:

“(b) Every nonresident of this State who after January 1, 2004, accepts election or appointment as an officer of a corporation organized under the laws of this State, or who after such date serves in such capacity, and every resident of this State who so accepts election or appointment or serves in such capacity and thereafter removes residence from this State shall, by such acceptance or by such service, be deemed thereby to have consented to the appointment of the registered agent of such corporation (or, if there is none, the Secretary of State) as an agent upon whom service of process may be made in all civil actions or proceedings brought in this State, by or on behalf of, or against such corporation, in which such officer is a necessary or proper party, or in any action or proceeding against such officer for violation of a duty in such capacity, whether or not the person continues to serve as such officer at the time suit is commenced. Such acceptance or service as such officer shall be a signification of the consent of such officer that any process when so served shall be of the same legal force and validity as if served upon such officer within this State and such appointment of the registered agent (or, if there is none, the Secretary of State) shall be irrevocable. As used in this section, the word ‘officer’ means an officer of the corporation who (i) is or was the president, chief executive officer, chief operating officer, chief financial officer, chief legal officer, controller, treasurer or chief accounting officer of the corporation at any time during the course of conduct alleged in the action or proceeding to be wrongful, (ii) is or was identified in the corporation’s public filings with the United States Securities and Exchange Commission because such person is or was one of the most highly compensated executive officers of the corporation at any time during the course of conduct alleged in the action or proceeding to be wrongful, or (iii) has, by written agreement with the corporation, consented to be identified as an officer for purposes of this section.”

Section 4. Amend the newly redesignated Section 3114(c), Title 10, Delaware Code, by replacing the word “or” after the word “trustee” in the second sentence thereof with a comma and by inserting the words “or officer” after the word “member” in the same sentence.”

Section 5. Amend the newly redesignated Section 3114(d), Title 10, Delaware Code, by replacing the word “or” after the word “trustee” with a comma in both places where same appears; by inserting the words “or officer” after the word “member” in both places where same appears; and by replacing the words “subsection (b)” with the words “subsection (c)”.

Section 6. This Act shall become effective on January 1, 2004.

SYNOPSIS

This amendment enables Delaware courts to exercise personal jurisdiction over persons who accept election or appointment as officers of a Delaware corporation, or who serve in such capacity, for claims brought against them in their official capacity.

Author: Delaware Bar Association