logo

Australian Corporate Law Breach

   

Added on  2019-11-29

4 Pages797 Words104 Views
 | 
 | 
 | 
Australian corporate Law 1AUSTRALIAN CORPORATE LAWStudent’s NameCourseProfessor’s NameUniversityCity/StateDate
Australian Corporate Law Breach_1

Australian corporate Law 2Australian Corporate LawTrump Development limited Company has breached its constitution by borrowing moneyto expand its operations from overseas financial institutions against the company’s constitution provisions that requires it to source financing from the Approved Australian Financial Institutions. It is important to note that the company has 4 directors whereby the majority 3 directors are keen to expand the company’s portfolio to include Casino developments in Caribbean, Atlantic City and Las Vegas. The company’s constitution allows the minority shareholders in a company to negotiate their terms of relationship with the others as well as to protect their interests. In this particular case, a more conservative director Hillary was not in agreement with the other three Big Donald, Little Marco and Bernie to deviate from Core Company’s objective of developing residential properties in Sydney Melbourne and other capitalcities.Article 141 of the Australian Corporations Act, states that a company’s constitution is clear and supreme than the replaceable rules because it provides the framework through which the management of the affair of the company are anchored1. Replaceable rules can be enacted bymajority of the shareholders in the interest of the company but should not violate the constitution2. In this particular case, one of the non-executive directors Slick Willy flouted the provisions of the company’s constitution by seeking funding from overseas financial institutions to enhance expansion of Trump Development Limited into casino markets which terrible failed as a result of capital exhaustion. As a result the company ended up experiencing cost overruns in 1Cassidy, Julie. Concise Corporations Law. St, Leichhardt NSW: Federation Press, 2006.2Australia. Australian Corporations & Securities Legislation 2011: Corporations Act 2001, ASIC Act 2001, related regulations. Sydney: CCH Australia Limited, 2011.
Australian Corporate Law Breach_2

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents