LAW 2505 Lecture Notes - Lecture 11: Reasonable Time, Breach (Security Exploit), California State Route 2
23 May 2018
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Department
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ISSUES CHECKLIST
1. Introduction- Always state
a. Who is seeking advice?
b. If important, flag the company type- PUBLIC/ Small or lrg PTY LTD
c. The parties and any particular relationship (eg a D may also be a CFO in the
Co)
d. A has potentially… B may succeed in…
e. This answer will also consider what consequences and potential relief is
available.
2. Issues
a. Ethics of corporate lawyering
→ S 68/ 69 LPA
→ To who the duty is owed and how lawyers are held to account
1. S 79 LPA- involvement, accessorial liability for contraventions
of CA
2. ASIC v Sommerville
3. Sharfon v ASIC
b. Shares
→ Characteristics, rights and obligations on members/ Co
→ Issue of bonus shares
→ transfer of shares
→ variation of class rights s 246B
→ Dividends
1. Dividends paid out to members- breach of duty of care?
→ MEMBER’S REMEDIES- standing- which is available and
appropriate?
c. Shareholders meetings
→ Calling (D/ Members requesting Ds/ members alone/ court)
→ Proper purpose s 249Q
→ Reasonable time and place s 249R
→ Resolutions passed
→ MEMVER’S REMEDIES- OPPRESSION
d. Financial reporting and disclosure
→ Requirements adhered to?
→ CONSEQUENCES
1. D FAILS TO COMPLY WITH pt 2M.2/3 = CONTRAVENES
S 344(1) - CIVIL PENALTY PROVISION
2. PRESUMED INSOLVENT s 588E(4)
3. BREACH OF DDS- WHICH REMEDY is available and
appropriate?
→ was there also a breach of duty of care?
e. Auditors
→ validity of appointment (cherry picked; unqualified/ conflict of
interest); company hasn’t complied with reporting requirements- is auditor
liable?; can the Co remove the auditor?
f. Directors duties- consider each defendant’s breach and consequence separately
(can cross reference, but ALWAYS apply the different facts)
→ Do duties apply to the person?
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Issues checklist: introduction- always state, who is seeking advice, if important, flag the company type- public/ small or lrg pty ltd, the parties and any particular relationship (eg a d may also be a cfo in the. Co: a has potentially b may succeed in , this answer will also consider what consequences and potential relief is available, issues, ethics of corporate lawyering. To who the duty is owed and how lawyers are held to account: s 79 lpa- involvement, accessorial liability for contraventions of ca, asic v sommerville, sharfon v asic, shares. Characteristics, rights and obligations on members/ co. Member"s remedies- standing- which is available and appropriate: shareholders meetings. Calling (d/ members requesting ds/ members alone/ court) Memver"s remedies- oppression: financial reporting and disclosure. Consequences: d fails to comply with pt 2m. 2/3 = contravenes. ; can the co remove the auditor: directors duties- consider each defendant"s breach and consequence separately (can cross reference, but always apply the different facts)
