Legal Question in Business Law in Maryland
If a person who sits on a board of trustees for a Non Profit organization arranges to be hired to do work for that organization by using his influence on the board. Then uses that same influence to try to force more money than what is agreed upon do they violate any laws?
2 Answers from Attorneys
They would appear to violate their duty as a fiduciary to the organization. These organizations are governed by by-laws and there would be an opportunity to vote this person off the board at the next election. If there was a contract between this person and the board for services, that contract would be enforceable against any attempt to demand more money, as long as there was no change in the scope of services to be performed.
The other attorney summarizes the issues that need to be considered. Fiduciary duty is the more important one, going even back to the hiring decision. Was this person the most qualified, and was he or she hired just because of their influence? Consult with an attorney in your area for specific advice.
Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise
Franchise Attorney
Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise
Franchise Attorney
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