Assignment - Overview of Business Law

BUSINESS LAW ASSIGNMENT 1
BUSINESS LAW ASSIGNMENT
Student’s Name
Course
Professor’s Name
University
Date
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BUSINESS LAW ASSIGNMENT 2
HYPOTHETICAL ILAC QUESTION:
It is clear from the case that the main issue is molarity. Brad is a very irresponsible
partner of the business. He made misleading information when he told Elena and Jack regarding
the illiquidity of IDesign. As a result , he made the company Digital10 to make the acquisition
of IDesign regardless of the fact that it was not a profitable business. In addition , instead of
working on improving the company , Brad went further to waste more money on drugs and
gambling . This led to the ultimate liquidation of Digital 10. According to the Corporations Act
2001, directors and officers in an organization ought to discharge their duties in a way that is
considered as beneficial to the organization to the company .
The test of duty and care as contained in the Act offers a collective application of
the principles with respect to the individual directors . In this case bot the objective part as
well as the subjective elements have been applied . Therefore , irrespective of the fact that all
the directors had similar duties , the assessment of standards of conduct only accounted for
the individual circumstances of each director . As earlier indicated , the Corporations Act
clearly codifies the obligations of the directors . Therefore, the directors were liable on the
fact that the never tool reasonable diligent steps on becoming informed regarding the
matter and further had personal financial dealings . This resulted in the director having
irrational basis to believe that the decisions were of the best interests of the company at the
time.
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BUSINESS LAW ASSIGNMENT 3
The fundamental issue in this case is to whether directors of such companies are
required to use their mind to conduct careful review of the financial statements in order to
properly determine their authenticity . This would have further helped in ensuring that
information provided was consistent with their knowledge of company affairs . However,
they omitted some material known to the, as well as material that was supposed to be
known to them .
In this case , Brad was not able to discharge his obligations for the benefit of the
company and as a result he gave way to various self-dealings thus leading to the downfall of the
company . In addition , Elena had suspicions regarding Brad’s activities but chose not to disclose
anything to Jack which demonstrate neglect on her side. Therefore, we can conclude that Brad
was liable for the liquidations of the company . Elena was also liable for turning a blind eye on
her suspicions.
ASIC was encouraged to take a number of administrative , civil and criminal actions
in relations to director misconducts . A cooperative framework to deal with ASIC might
benefit a person in multiple ways .For instance; early notification or a cooperative approach
during such an investigation will usually be relevant to the consideration of what kind of
actions would be necessary to pursue and what kind of remedies would be better to seek. In
any case involved by ASIC , the court always offers due credit for any cooperation received
from the person or entity against who such proceedings are brought .
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