Directors

Front 1

Define director

Back 1

Section 126 broadly defines

Involved in the running of the company, fulfilling the role,

Anyone exercising the powers of a director will be included in definition irrespective of what they are called. Eg person who occupies the position. A shareholder can be deemed a director

Front 2

Becoming a director they must

Back 2

Consent in writing to the appointment and

State that they are not disqualified from holding office

Front 3

Powers and duties of directors

Back 3

Section 126 to 162

Section 128=over arching authority of the directors is the authority to manage

Overarching duty to Act in good faith and in the best interests of the company.

Front 4

What is a type of Breach of duty to act in good faith

Back 4

Breach would occur if director was acting in their own interests without regard for the company or members. Or breach if director fails to properly monitor the activities of the Company’s employees or controllers

Front 5

Liability for breaches of duty

Back 5

Section 135 Reckless trading

breach of duty duty as a director by allowing the company to engage in reckless trading. Eg The transaction carried risk of causing the company to be liquidated

Carried out business in a manner that was likely to create a substantial risk of serious loss to the companies creditors

Front 6

Liability for breaches of duty

Back 6

Section 135 Reckless trading

breach of duty duty as a director by allowing the company to engage in reckless trading. Eg The transaction carried risk of causing the company to be liquidated

Carried out business in a manner that was likely to create a substantial risk of serious loss to the companies creditors

Front 7

Section 138A

Back 7

Covers offenses following serious breaches. A breach of 135 reckless trading is deemed to be an offence.

Front 8

Section 373(4)

Back 8

Gives penalties for serious breaches of directors duty to act in good faith and in the best interests of the company. Conviction is imprisonment or fine