Breaches and Remedies: Common Law, Equitable Principles, Corporations Act 2001

3157 Words Nov 2nd, 2013 13 Pages
Assignment 1 Question C
This paper will seek to identify any breaches of Common Law, Equitable principles, sections 180-184 of the Corporations Act 2001 (Cth), and any other breaches of the aforementioned Act specifically dealing with Takeovers, whilst describing any appropriate remedies that may be available for said breaches.

Breaches of s180-184 of the Corporations Act 2001 (Cth), and Breaches of Common Law and Equitable Principles

S180(1) of the Corporations Act 2001 Commonwealth (hereinafter referred to as The Act) states that a “director or 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
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This would seem unlikely though as the action was not aimed at Stefani personally and the test is objective taking in the context, cumulative effect and the circumstances as a whole.6 This being considered the move will be beneficial for MF, which is ripe for a takeover. Also taking into consideration Stefani’s own misconduct it would be unlikely for an oppression plea to be successful.

Stefani has breached s181. He has voted for an improper purpose in his own interests and not in good faith for the best interests of the corporation. Essentially he is trying to protect his own interests. For this reason he is likely to invoke the civil penalty provisions associated with s1317E.

This section of The Act relates to the “fiduciary duty to prevent conflicts arising between the officers private interest and the company’s interest and the obligation to act in the best interests of the company.”7 The Act imposes a duty on directors and other officers not to improperly use their position to gain an advantage for himself or herself or someone else or to cause detriment to the corporation. At first view it would appear that Stefani has not breached this section, as he has not, on the facts, achieved either an advantage for himself or a detriment to the corporation. However the cases of Chew v The Queen,8 R v Byrnes,9 and ASIC v Adler10 indicate that the

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