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Breach of Director Duties: A Case Study on Lilian and Gumpta

Understand the principles of Australian company law, identify and analyze relevant facts and legal issues, interpret company law legislation, appreciate the role of compliance and the requirement to follow laws in the industry.

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Added on  2023-04-23

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This article discusses the breach of director duties by Lilian and Gumpta in a case study. It covers the relevant rules and provisions under the Corporations Act 2001 (Cth) and the penalties for such breaches.

Breach of Director Duties: A Case Study on Lilian and Gumpta

Understand the principles of Australian company law, identify and analyze relevant facts and legal issues, interpret company law legislation, appreciate the role of compliance and the requirement to follow laws in the industry.

   Added on 2023-04-23

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Running head: Business Law Assignment 0
Corporate Law
BO1CLAW314
Breach of Director Duties: A Case Study on Lilian and Gumpta_1
Commercial and Corporation Law 1
Contents
Issue............................................................................................................................................................2
Rules............................................................................................................................................................2
Application..................................................................................................................................................5
Conclusion...................................................................................................................................................7
References...................................................................................................................................................8
Breach of Director Duties: A Case Study on Lilian and Gumpta_2
Commercial and Corporation Law 2
Issue
The issue of the case is to check that whether Lilian and Gumpta are liable to breach any director
duty. In addition, this is to check that what will be the consequences of such a breach.
Rules
A company is a legal person that has many rights and duties. Because of such legal personality, a
company is able to do many of the tasks by its own name. In addition to being a legal
personality, a company has a distinct recognition from its directors and members and such
people cannot held personally liable for any of the act of company Salomon v Salomon & Co Ltd
(1897) AC 22 is an important case in which separate legal identity of the company has been
recognized by the law. Although a corporation is a separate legal personality, yet the same
requires individuals to act on behalf of the same. These individuals are no one else but the
directors and officers of the company who take business decisions on behalf of the company but
are not personally liable because of the separate legal status of the corporation. Re Centura
Global Holdings Pty Ltd [2015] NSWSC 1744, Forkserve Pty Ltd v Jack (2001) 19 ACLC 399,
ASIC v Cassimatis (No 8) [2016] FCA 1023, Fodare Pty Ltd V Shearn, Supreme Court of New
South Wales, 25 May 2011 and so on are the cases where directors were held liable for the
breach of the duties mentioned under act has been breached.
Breach of Director Duties: A Case Study on Lilian and Gumpta_3

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