tutorial 5 - Jiayi Zheng issue Is there any negligence...

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Jiayi Zheng issue:  Is there any negligence in Pear Ltd? laws: —180(1) care and diligence-directors and officers     A director or other officer of the corporation must exercise their powers and discharge their du- ties with the degree of care and diligence that a reasonable person would exercise if they     (a) were a director or officer of a corporation in the corporations’s circumstance;and     (b) occupied the office held by, and had the same responsibilities within the corporation as, the  director or officer — the court examines the actual amount of care and diligence exercises by the directors and com- pares this with the degree of care and diligence that a reasonable person would exercise if they  were a director of a similar company and had the same responsibilities as the director. —in Daniels v AWA Ltd case, court state that:     .A director must acquire basic understanding of the business of the company and must be famil- iar with the fundamentals of the company’s business     .Directors are under a continuing obligation to keep informed about the activities of the company     .Detailed inspection of day-to-day activities is not required but what is required is a general mon- itoring of the company’s business affairs.Accordingly, a director should attend board meeting regu- larly.     . While directors are not required to audit the company’s books they should maintain familiarity  with the financial status of the company by a regular review of financial statement. —in ASIC v Vines:     . the court held that evidences of what a reasonably competent chief financial officer would have done is relevant to the determination of whether the defendant breached his statutory duty of care  and diligences.
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