Reference Case: Dalian Daxian Group Co., Ltd. v. Dongbei Jincheng Construction Co., Ltd.
When reviewing the validity of a shareholders' resolution, courts should focus primarily on legality and only secondarily on reasonableness, examining whether convening, voting, or the substance of the resolution violates mandatory law or the articles. Where the resolution does not breach such rules or harm the company or other shareholders, courts should not replace corporate self-governance with their own business judgment.
Holding
When reviewing the validity of a shareholders' resolution, courts should focus primarily on legality and only secondarily on reasonableness, examining whether convening, voting, or the substance of the resolution violates mandatory law or the articles. Where the resolution does not breach such rules or harm the company or other shareholders, courts should not replace corporate self-governance with their own business judgment.