How do fiduciary duties apply to corporate opportunities in the context of a board of directors?

• A. Directors may pursue corporate opportunities personally without disclosure.
• B. Directors must present corporate opportunities to the company if they fall within the corporation's line of business and not pursue them personally.
• C. Corporate opportunities belong to the director unless the company refuses.
• D. The board's duty does not apply to opportunities outside the corporation's core business.

Answer: (B)

Directors owe a fiduciary duty of loyalty that includes not taking for themselves a business opportunity that belongs to the corporation. When a director learns of an opportunity through their position and it falls within the corporation’s line of business (or is something the company would likely pursue), the director must present that opportunity to the company and refrain from pursuing it personally. The company then has the option to accept and pursue it, or to reject or let it lapse; if the company rejects or does not act in a reasonable time, the director may pursue it themselves. This protects the corporation from self-dealing and ensures opportunities that fit the business aren’t secretly captured by a director.

So the best answer reflects that duty: present the opportunity to the company if it lies in the corporation’s line of business and do not pursue it personally. The other options conflict with the loyalty duty (taking the opportunity without disclosure), misstate ownership (the opportunity isn’t automatically the director’s unless the company declines), or wrongly limit the duty to only core business (the duty covers opportunities related to the corporation’s business, not just its core area).