NC Business Court Steps Into Uncharted Territory On Advancement And Indemnification For Corporate Officers

Judge Robinson boldly went where no North Carolina Judge writing published Opinions had gone before last month in the case of Wheeler v. Wheeler, 2018NCBC117.  The subject was a corporate officer’s right to the advancement of legal fees incurred in defending against a lawsuit. Judge Robinson noted that there was only “one case in which our appellate courts have dealt with the issue of advancement.”  Op. ¶1 & n.1.  That case was inapplicable to the Wheeler decision. Advancement (the right for an officer, director, agent or employee of a corporation to be reimbursed for expenses incurred in litigation) is governed by G.S. §55-8-53.  The right to be indemnified for a liability resulting from such litigation is governed by G.S. §55-8-51. The corporation of which Plaintiff (Gray Wheeler) was an officer, director, and shareholder had provided for advancement and indemnification rights in its Bylaws.  It was the Gray…

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