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Title: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
Description: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
Description: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
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BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
Director: acts as an agent for the company; will incur liability on behalf of the company, not personal liability; section 250 CA 2006: director includes any
person occupying the position of director, by whatever name called; not limited to those that have been formally appointed (De Jure), but those who have
been given the position (De Facto)
...
If not carrying out
functions/decisions/management, may not be a director as a matter of fact
...
*Board meetings – the mind of the company; recommending dividends;
all directors must attend board meetings; shareholders do not attend
...
De Jure Directors – formally and validly
appointed subject to the articles of
association by ordinary resolution or by
decision of the directors; decision taking
as a board, as a sub-committee of the
Board, as individuals
...
*The Chairman of the Board – gets casting vote to defuse deadlock;
board will appoint chairman
...
S168(5)(a) CA 2006 – cant remove
his rights to claim for compensation in respect of termination
...
Have to give at least 28 days notice
...
Bushell v Faith – shares = amount of votes
...
*Retirement – public companies – at the end of a set period and rotation
...
*Private co: min 1 director
...
A corporation can be
appointed a director BUT at least 1
director must be a natural person (s155)
...
No maximum age
(cf s293 CA 1985)
...
Having been appointed formally,
but acting as a director
...
*Re Hydrodam (Corby) Ltd –s251(1) to
apply 4 factors to take into account
...
*Disqualification – Company Directors’ Disqualification Act 1986
...
Duty to: act within powers; to
promote the success of the company; to exercise independent judgment;
exercise reasonable care, skill & diligence; to avoid conflicts of interest;
to not accept benefits from third parties; to declare interest in proposed
transactions
...
*IDC v Cooley – Resignation is no defence to an action for breach of
conflict/benefits from third parties
...
*Duty to act within the co’s constitution
...
*Duty to act for ‘proper purposes’ – Howard Smith Ltd v Ampol
Petroleum Ltd –unconstitutional for directors to use their fiduciary
powers over the shares in the co for the purpose of destroying an existing
majority or creating a new majority
...
*The ‘proper purposes’ doctrine encapsulated in s171 is an incident of the
central fiduciary duty of directors to promote the success of the co
...
Title: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
Description: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics
Description: BUSINESS LAW – COMPANY LAW (lecture 9) – Directors and Business Ethics