Directors personal liability – misleading & deceptive conduct

Despite the corporate veil, there are many ways in which a director can be personally liable for activities the company which they direct.   One such ground is misleading and deceptive conduct pursuant to section 18 of the Australian Consumer Law (Cth)(ACL).  This question of personal liability is of concern to conservative and risk averse directors who attempt to strike the delicate balance between governance and entrepreneurialism.  Misleading and deceptive conduct can occur in a variety of circumstances in business dealings.  From misleading advertising, inaccurate projections to contractual dealings between parties.  It could be as simple as making misstatement regarding a profit forecast or embellishing the outcome of a contract. [Read more…]

Do beneficiaries have a right to the trust deed?

In Queensland, the statutory rights and obligations of Trustees are contained in the Trusts Act 1973 (Qld)(Trust Act).  The role of the Trustee is fiduciary in nature and as such, there is a duty to act in accordance with both the terms of the deed of trust (Trust Deed) and the common law and statutory duties.  However, the Trust Act does not contain an express provision for a Trustee of a trust to provide a Trust Deed to beneficiaries. As a result, common law provides beneficiaries the right to make such requests to the Trustee.  This article will discuss the common law right of beneficiaries to access a Trust Deed upon request to the Trustee. [Read more…]

Counterclaiming in legal proceedings in Queensland

It is not uncommon for parties to a dispute to each believe that an action lies against the other arising from the same facts.  Where this occurs, and one party (Plaintiff) has commenced proceedings against the other party (Defendant) in Queensland, the Uniform Civil Procedure Rules 1999 (Qld) (UCPR) allows the Defendant to commence their own proceeding against the Plaintiff within the original proceeding, rather than requiring the Defendant to commence a separate legal action.  This is known as a counterclaim.   In this article we consider the nature of a counterclaim and the rules and circumstances that govern its use in proceedings in Queensland Courts. [Read more…]

What is a term sheet?

A term sheet (Term Sheet) is a document that sets out the basic terms and conditions on which parties intend to enter into a commercial agreement.  Term Sheets are generally not intended to create legal relations between the parties but rather to form the basis of further discussions, which may be exclusive for a period of time and on a strictly confidential basis.  Once parties reach consensus on the commercial terms of a Term Sheet, a legally binding contract is then drawn up.

 

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Top 7 common mistakes in commercial contracts

When negotiating the terms of commercial contracts there are many pitfalls even for those of us with significant experience in these matters.  For this reason, we’ve put together what we consider to be the ‘Top 7 common mistakes” we see in commercial contracts. [Read more…]

Convertible notes in capital raising

Overview of some of the issues associated with use of convertible notes in capital raising.

Copyright infringement online

Copyright infringement online, copyright in photographs.

Shadow Directors

Discussion of law around shadow directors in Australia.

Shareholders right to information

Background on shareholder right to information in Australia.

Shareholders’ right to information

One of the tell tale signs of a shareholders’ dispute occurs when those with the access to information restrict access to it for others.  It’s very common for us to see this.  There are several reasons why a shareholder may require company information, primarily where a minority or oppressed shareholder loses control and is removed as a director.  There may be reasonable suspicions that the company is financially unstable or the conduct is oppressive to its shareholders.  These scenarios mean that a shareholder is not being provided with the full information on whether they are being oppressed.  On its face the aggrieved shareholder may think that little can be done.  This is not the case as the Corporations Act 2001 (Cth) (Act) provides for various mechanism for minority shareholders to obtain relevant information from the company.   [Read more…]

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