Understanding Business Law Concepts

This business law assignment explores various concepts including the issuance and regulation of securities, employee obligations, shareholder rights, and company governance. It delves into topics such as conflicts of interest, directorial duties, share types, and the role of the constitution in regulating internal company affairs. The assignment also examines legal remedies available to shareholders and the impact of agents' actions on the company.

Running head: BUSINESS LAW
Business law
Name of the Student
Name of the University
Author Note

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1. Securities are the shares in the capital of the company. They are used by the company to
raise fund for the company. Shares have to be issued by an organization through
following the guidelines provided by the Australian Securities and Investment
commission and the Corporation Act 2001 (Cth). These procedures involve processes
such as publishing an offer. Public companies registered with ASX can issue securities.
2. Yes, in case such a situation takes place the employer has the right to take action against
the employees. There are both common law and statutory provisions under which an
employeris allowed to take actions against employee in such situation. These involve he
equitable obligation of confidence, corresponding obligations owed under sections 182
and 183 of the Corporations Act 2001 (Cth), fiduciary duties to act in their employer’s
best interests and not in their own interests and express and implied obligations owed as
part of their contract of employment.
3. No the company does not have the right to confiscate the shares of the members even if it
is in the best interest of the company. At most they can purchase back the shares at an
agreed amount or amount set by the court. In situation where the members feel they have
been treated unfairly they can make a claim under section 232-234 of the CA related to
oppressive remedy.
4. The officers are those person who are the directors or secretaries of the company or who
have the power to participate in the decision making process of the company, who has the
capacity to affect significantly the corporation’s financial standing, in accordance with
whose instructions or wishes the directors of the corporation are accustomed to act as per
section 9 of the CA. their duties are same as the directors as set out in section 180-190 of
the CA.

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5. Conflict of interest is the position where a situation arises in which the interest of the
company and the personal interest of the directors are in conflict. In such situation the
directors always have to give priority to the company’s interest as per section 182-183 of
the CA and common law.
6. No, the members of the company also can be provided with the right of initiating or
getting into a legal proceeding on behalf of the company through an order obtained under
section 233 of the CA.
7. Yes the Jim has the right to call a meeting for the company. Under section 249D he can
request the directors to call a meeting. Under section 249 F members can call a general
meeting for the company. Usually the meetings of the companies are called by the
directors of the company as per part 2G.2 Division 2 of the CA
8. The internals rules of the company are governed by the constitution and replicable rules
as per section 135 and 136 of the CA. according to section 140 the constitution and the
replaceable rules have the effect of a contract between the directors and the company. So
in case the rules are breached it would be treated as a breach of contract by such
directors.
9. There are various types of shares which can be issued by the company such as ordinary
shares and preference shares. Yes, different members can be provided with different
shares through the passing of a special resolution. The difference between the shares
which is held by the persons is indicated through the rights such persons are provided in
relation to such shares such as preference shares are paid first.
10. It is the duty of Gary in this case to act in the best interest of the shareholders. He owes a
fiduciary duty to the shareholders once the company has been incorporated. This duty

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involves prioritizing the best interest of the shareholders and the company before
personal interest and acting in good faith towards the company.
11. According to section 254 B of the CA the company has the right to set out the terms in
which its shares are issued and impose restriction on such shares. According to section
140 there is a contractual relationship between the company and its members through the
constitution. Thus the right of Zippy as per the constitution is restricted. However he has
the right of claiming a remedy under section 233 of the CA.
12. According to section 126 of the act the acts of the agent are binding on the company even
if it has acted out of authority or the act is not in the best interest of the company. An act
as per section 125 of the CA is not invalid merely because it is prohibited by the
constitution.
13. The constitution of the company can be amended by passing a special resolution under
section 136 of the CA. The company can rise capital by issuing shares. Other methods of
raising capital are issue of debentures.

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References
Corporation Act 2001 (Cth)