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Directors' duties

Page history last edited by PBworks 16 years, 2 months ago

Directors' duties

 

Corporations Act

 

  • S 180 care and diligence
  • S 181 – good faith, self interest
  • S 182 - improper use of position
  • S 183 – improper use of information
  • s184 – intentional dishonesty
  • S 191 – failure to fully disclose

 

Other CA breaches

 

  • S 195 – causes other directors to breach as cannot allow him to stay unless know extent of interest
  • S 1309 – giving false information
  • S 1043A(1) – insider trading

 

Common law breaches

 

  • Good faith
  • Conflict
  • Secret profit

 

Remedies and Penalties

 

  • Ss 180 – 183 – civil penalties $200,000 fine & disqualification.  Pecuniary penalty orders
  • Ss 181 – 183 – criminal offences where dishonesty involved.  Up to 5 years jail
  • S 195 – strict liability criminal offence (but transaction not invalid)
  • S 1309 – criminal and Ss 1043 (1) & (2) – criminal and civil (ss 1317 (jf) & (jg)

 

Care and Diligence

 

  • Assess director’s performance against objective standards i.e. reasonable director
  • Common Law duty not a fiduciary one
  • Care and diligence does not raise issues of good faith or honesty (separate duties)
  • Consider s180 (1) and AWA and CBA v Freidreich cases

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