LAWS3100 Final: Member Remedies (Chap 16)
Lecture 8: Members’ Remedies (Chapter 16)
A) Members’ statutory remedies
- Oppression remedy
- Court-ordered winding up
- Statutory injunction
- Statutory right to inspect company books
B) Member’s personal action
C) Member’s derivative action
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- Members’ remedies may be available where officers have breached their duties
- Sometimes members can also obtain a remedy even though there has been no breach of officers’ duty
-Members have statutory and general law remedies
Why do minority members need remedies?
- Directors and majority shareholders can use their power to harm minority shareholders
- Not always possible for a shareholder to sell their shares
- Explains why the oppression remedy is most commonly sought by shareholders in proprietary
companies rather than public companies
A) Members’ statutory remedies
1. Oppression remedy
2. Court-ordered winding up
3. Statutory injunction
Statutory right to inspect company books
4. Other protection:
variation of class rights (Chapter 7)
transactions affecting share capital (Chapter 20)
1. Oppression remedy *Pt2F.1
Available in respect of:
- the conduct of the company’s affairs, or
- an actual or proposed act or omission by or on behalf of the company, or
-a resolution, or a proposed resolution, of members or a class of members
Where the conduct complained of is either:
- contrary to the interests of the members as a whole, or
-oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member or members
To what types of companies can the remedy apply?
In theory, any company
In practice, most oppression actions are brought by members of proprietary companies
- Which have only a few participants, and
- In which members are also involved in management
Who can apply to the court?
- A member, even if the oppression relates to:
- the member in a capacity other than a member
- another member in their capacity as a member
- A person removed from the register of members because of a selective capital reduction
- A person who will cease to be a member if the oppression action relates to the circumstances in which they
cease to be a member
-A person whom ASIC thinks appropriate having regard to its investigations into the company’s affairs
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Lecture 8: members" remedies (chapter 16: members" statutory remedies. Statutory right to inspect company books: member"s personal action, member"s derivative action. Members" remedies may be available where of cers have breached their duties. Sometimes members can also obtain a remedy even though there has been no breach of of cers" duty. Members have statutory and general law remedies. Directors and majority shareholders can use their power to harm minority shareholders. Not always possible for a shareholder to sell their shares. Explains why the oppression remedy is most commonly sought by shareholders in proprietary companies rather than public companies: members" statutory remedies, oppression remedy, court-ordered winding up, statutory injunction. Statutory right to inspect company books: other protection: variation of class rights (chapter 7) transactions affecting share capital (chapter 20, oppression remedy *pt2f. 1. The conduct of the company"s affairs, or. An actual or proposed act or omission by or on behalf of the company, or.
