Dargestellt wird das kompakte Feld der Managerhaftung unter dem Blickwinkel der Haftpflichtdeckung durch Versicherer in den USA und Deutschland. Aufgeteilt ist die Abhandlung in die drei Komplexe: 1. Entwicklung der D&O-Versicherungen 2. Haftungssituation in den beiden Ländern und 3. Deckungskonzepte nebst Rechtsprechung.
Table of Contents
1 Introduction
2 Management duties and liability
2.1 Duties and liability of American directors and officers
2.1.1 Internal management liability
2.1.2 External management liability
2.1.3 Enforcement of liability
2.2 Duties and liabilities of German directors and officers
2.2.1 Internal management liability
2.2.2 External management liability
2.2.3 Liability of supervisory boards
2.2.4 Enforcement of liability
2.3 Major differences between the American and German liability systems
3 Historical development of D&O insurance
3.1 Historical development in the United States
3.2 Historical development in Germany
4 Reliability and risk of abuse of the liability cover provided by D&O insurance policies
4.1 Reliability of D&O insurance
4.2 Conflicts of interest and the friendly assertion of claims
4.2.1 Jurisdictional clause
4.2.2 Termination clause
4.2.3 Publicity clause
4.2.4 Individual abuse clause
4.2.5 Major shareholder exclusion
4.3 Balance sheet function of D&O insurance
5 Conclusion
Research Objectives and Key Themes
The work aims to provide a comprehensive analysis of the liability risks facing corporate managers in the United States and Germany, focusing on the role and reliability of Directors' and Officers' (D&O) insurance as a protective mechanism.
- Comparative analysis of American and German corporate management liability legal frameworks.
- Evaluation of the historical development and market evolution of D&O insurance in both countries.
- Examination of the "abuse risk" and potential for "friendly assertion of claims" within internal corporate liability structures.
- Assessment of the effectiveness of policy clauses, such as jurisdictional, termination, and publicity clauses, in mitigating collusion risks.
- Discussion on the balance sheet function of D&O insurance and the implications for corporate governance.
Excerpt from the Book
2.1.1.1 Business judgement rule
The most important internal duties of directors and officers encompass the duty of loyalty and the duty of care. These are addressed in greater detail below. In addition, the business judgement rule has been developed by the courts. In accordance with this rule it is intended that managers who act on behalf of their companies in good faith should be protected from personal liability. Within the framework of this business judgement rule it is intended that it should be possible for directors and officers to take corporate decisions even if they involve a certain degree of risk for the company and it should subsequently transpire that they were incorrect. Accordingly, is not intended that the management of a company should be held liable if their actions end in failure.
The business judgement rule criterion is utilized by American courts in the sense of a clearing inspection, with the result that a judicial examination of any breach of the duty of care is conducted if the limits of the business judgement rule are exceeded.
Summary of Chapters
1 Introduction: This chapter introduces the increasing personal liability risks for managers due to stricter legal environments and the resulting emergence of D&O insurance as a crucial management safeguard.
2 Management duties and liability: The chapter explores the distinct corporate law structures in the US and Germany, outlining specific management duties (care, loyalty) and the procedural avenues for enforcing liability claims in each jurisdiction.
3 Historical development of D&O insurance: This section tracks the evolution of D&O insurance from its origins following major market crises to its current role as a standard and often mandatory component of executive protection.
4 Reliability and risk of abuse of the liability cover provided by D&O insurance policies: The chapter examines the potential for collusion and "friendly assertions" of claims between insured parties and policyholders, and analyzes the adequacy of common contract clauses meant to prevent such abuse.
5 Conclusion: The summary highlights the fundamental differences in liability cultures between the US and Germany and asserts that despite identified abuse risks, D&O insurance remains economically necessary to foster entrepreneurial freedom.
Keywords
D&O Insurance, Corporate Liability, Business Judgement Rule, Management Duties, Fiduciary Duty, Shareholder Litigation, Class Action, Derivative Suit, Corporate Governance, Internal Liability, External Liability, Risk Management, Insurance Fraud, Collusion, Supervisory Board.
Frequently Asked Questions
What is the core focus of this publication?
The book examines the liability risks for company directors and officers under American and German law and explores the role of D&O insurance as a coverage mechanism in these two different legal environments.
What are the primary thematic areas covered?
The main themes include comparative corporate law, the historical evolution of D&O insurance markets, the risks of insurance abuse through collusive claims, and the practical implementation of D&O insurance in corporate governance.
What is the primary research question?
The research investigates how D&O insurance can provide effective coverage while balancing the risks of fraudulent collusion and moral hazard among corporate managers.
Which scientific methodology is employed?
The study utilizes a comparative legal analysis, examining statutory regulations, key court rulings, and industry practices regarding executive liability and insurance policies.
What topics are discussed in the main body?
The main body details management duties (care and loyalty), enforcement mechanisms like direct and derivative suits, historical insurance development, and specific policy clauses designed to prevent fraudulent claims.
Which keywords define this work?
Key terms include D&O insurance, corporate liability, business judgement rule, shareholder litigation, and corporate governance.
How do American and German management liability systems differ?
The US system relies heavily on common law and judicial discretion (business judgement rule), whereas the German system is characterized by more rigid statutory standards and a two-tier management structure.
What is the "risk of friendly assertion of claims"?
This refers to the potential for an insured manager and their company to collude in lodging an internal liability claim specifically to access the insurance payout, a risk that insurers attempt to mitigate through specific policy clauses.
- Quote paper
- Andreas Schlegelmilch (Author), 2004, D&O liability under American and German law and the liability cover furnished by insurers, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/284994
