Two shareholders who also serve as directors in a company had a clear conflict of interest in allowing the company to enter into a lease agreement with another company owned by them, at a rent less than can be obtained under market conditions. The third shareholder claimed that the two shareholders had harmed him and had clearly violated the duty of trust they owed the company.
The court held that the actual financial conflict is between the company and its two shareholders, who violated the fiduciary duty towards it in connection with an agreement that does not reflect the company's interest. The damage to the company to be borne by the two shareholders is the difference between the rent according to the agreements in force and the rent due on the opinion of an appraiser, for a period of seven years preceding the date of filing the claim.