Lecture 11 BFA601 Semester 2 2018.pptx

Criteria for court order has the irregularity caused

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Criteria for court order: Has the irregularity caused ‘substantial injustice’? Court orders may validate the meeting, request rectification, relieve a party of potential liability, or any other order as it sees fit MEETINGS Procedural irregularities (10.103) MEETINGS Procedural irregularities (10.103)
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© ‘Directors’ duties’ describes the obligations imposed by law upon directors, other officers and employees of a company. S 9 of the CA defines both ‘director’ and ‘officer’. A ‘director’ is a person who is either validly appointed to the office of director or one who acts in that position in a de facto capacity. An ‘officer’ is any person who is involved in significant decisions which affect the company’s financial standing. Officers include directors, the company secretary, receivers and managers DIRECTORS’ DUTIES What are directors’ duties (10.106) DIRECTORS’ DUTIES What are directors’ duties (10.106)
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© Directors and officers have a fiduciary position Directors must exercise care, skill and diligence and must balance profit making with appropriate social and legal standards imposed for the welfare of various stakeholders to company. DIRECTORS’ DUTIES Corporate governance and directors’ duties (10.107) DIRECTORS’ DUTIES Corporate governance and directors’ duties (10.107)
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© Both common law and statute applies to directors and officers duties. Common law and equity interprets statute, and some statute has replaced common law DIRECTORS’ DUTIES Directors duties under common law and the Corporations Act (10.108) DIRECTORS’ DUTIES Directors duties under common law and the Corporations Act (10.108)
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© Under common law directors are expected to exercise reasonable care, skill and diligence in their decision-making on behalf of the company as a whole, its members and others who deal with the company DIRECTORS’ DUTIES(1c) Duty to exercise a reasonable degree of care and diligence (10.109) DIRECTORS’ DUTIES(1c) Duty to exercise a reasonable degree of care and diligence (10.109)
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© Directors and officers must exercise care and diligence in decision making: an exercise of powers and discharge of duties reasonably expected of a person according to their office and responsibilities What is the title the officer has? How much are they paid? DIRECTORS’ DUTIES (1s) Statutory duty s 180(1) (10.110) DIRECTORS’ DUTIES (1s) Statutory duty s 180(1) (10.110)
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© CORPORATIONS ACT 2001 - SECT 180 Care and diligence--civil obligation only Care and diligence--directors and other officers (1) A director or other officer of a corporation must exercise their powers and discharge their duties 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 corporation's circumstances; and (b) occupied the office held by, and had the same responsibilities within the corporation as, the director or officer.
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