special facts rule
special-facts rule. Corporations. The principle that a director or officer has a fiduciary duty to disclose material inside information to a shareholder when engaging in a stock transaction under special circumstances, as when the shareholder lacks business acumen, the shares are closely held with no readily ascertainable market value, or the director or officer instigated the transaction. • This is an exception to the “majority rule.” — Also termed special-circumstances rule. Cf. MAJORITY RULE(3). [Cases: Corporations 316(3). C.J.S. Corporations §§ 519–524.]
