Corporate Law

Shareholder oppression – the early warning signs

The usual definition of shareholder oppression (Oppression) is something that occurs when a majority of shareholders in a company misuse their power to oppress minority shareholders.  That said oppression is not limited to situations of majority and minority, it can occur when the disputants have equal shareholding  but there is an imbalance of control (or power) caused by a variety of statutory and contractual controls that were agreed to at the start of the relationship. [Read more…]

Deal fatigue in business transactions

Deal fatigue is very common in commercial transactions in Australia because of the complexity of the law and the sheer volume of documentation that’s often required.  An unfortunate consequence can be that benefit of entering into the deal in the first place can be watered down to the extent that the deal becomes unpalatable.   This article will discuss the symptoms of deal fatigue and offer some tips on avoiding it. [Read more…]

Transfer duty exemption for small business restructures

On 9 October 2020, the Queensland Commissioner of State Revenue (Commissioner) issued Public Ruling DA000.16.1 (Ruling) which outlines new transfer duty exemptions under the Duties Act 2001 (Qld) (Act) available to eligible small businesses undergoing a restructuring.   The Ruling stems from a public announcement made by Queensland Treasurer Cameron Dick on 7 September 2020. [Read more…]

Terminating an indefinite contract

There may be many reasons for a contract having no end date (Indefinite Contract).  However, in practice this can be problematic when a party wants to end the contract for any reason.  In this article we examine how to deal with the various contractual requirements for termination of an Indefinite Contract. [Read more…]

Franchising Code changes closer to fruition

In November 2020, the Australian Government Department of Industry, Science, Energy and Resources (Government) released its hotly anticipated Exposure Draft proposing amendments to the Franchising Code of Conduct (Code).  The proposed amendments seek to implement the commitments the Government made in August 2020 in response to the Parliamentary Joint Committee’s March 2019 Fairness in Franchising Report (Franchising Report).  The Franchising Report identified a range of regulatory matters to be addressed in the franchising sector. [Read more…]

Changes to monetary threshold for consumer contracts

For businesses that provide goods or services to non-consumers, the recent Treasury Laws Amendment (Acquisition as Consumer – Financial Thresholds) Regulations 2020 (Amendment) has the effect of widening the scope of the consumer guarantees regime under the Australian Consumer Law (ACL).  This means that, as of 1 July 2021, contracts that were not previously subject to the consumer guarantee protections (because the value of goods or services was less than $40,000) will be captured under the new regime. [Read more…]

Just and equitable winding up for shareholder oppression

In matters involving the oppression of minority shareholders by the majority the usual legal remedy is to pursue relief for oppression as contained in sections 232 and 233 of the Corporations Act 2001 (Cth)(Act). However section 233(2) of the act also allows for an aggrieved party to seek an order winding up the company on just and equitable ground as if the order were made under section 461.  Section 233(2) represents the intersection of the just and equitable winding up and shareholder oppression. [Read more…]

Shareholders’ agreements & deadlock clauses

One of the most important issues to be addressed by a Shareholders’ Agreement is what happens where the directors or shareholders cannot agree and a deadlock arises.  In cases where voting of Directors of a board is proportional to the shareholding represented by the appointed director, or there can be a deadlock caused by “one vote, one director” care needs to be taken to ensure that control can be exercised by addressing the deadlock issue.  Of course the deadlock can also be between shareholders. [Read more…]

What are cooperative marketing funds?

Cooperative marketing funds allow franchisors to combine contributions from franchisees, to undertake advertising or promotional campaigns on behalf of the entire network.  This framework allows franchisors to implement marketing that would otherwise have been beyond reach financially.  However, it is important franchisors are aware of their obligations under the Competition and Consumer (Industry Codes – Franchising) Regulation 2014 (Franchising Code). [Read more…]

Force majeure in a major pandemic

To say the world has been turned upside down is all but literally true in many respects.  Where there is the slightest sneeze of Covid-19, governments have made shut down decisions that that have impacted the ability of businesses to operate and perform their contractual obligations.

A feverous question is whether COVID-19 an event of force majeure and does it relieve the affected party from its obligations?  Below we set out the issues. [Read more…]

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