Commercial Law: Case Study Analysis

Running head: COMMERCIAL LAW
COMMERCIAL LAW
Name of Student
Name of University
Author Note

BUSINESS LAW1
Table of Contents
Issue 1.........................................................................................................................................2
Law 1..........................................................................................................................................2
Application 1..............................................................................................................................2
Conclusion 1...............................................................................................................................3
Issue 2.........................................................................................................................................3
Law 2..........................................................................................................................................3
Application 2..............................................................................................................................4
Conclusion 2...............................................................................................................................4
Reference....................................................................................................................................6

BUSINESS LAW2
Issue 1
The primary issue in the case is whether Captin could be held liable for the breach of
duty of care under the Corporations Act.
Law 1
Section 180 of the Corporations Act states that any director or any other officer of a
company has the duty to be exercising the powers hold by them and discharging the duties
with a proper care and due diligence that can be expected from any reasonable individual. In
ASIC v Flugge (No.2) the provisions of this section in relation to the breach of the duties of a
director for care and diligence was discussed by the judges.
The fiduciary duty of a director or any other officer under s.181 of the Act is to be
acting for the best interest of the company and in a good faith. Acting for the best interest of
the company also includes the avoidance of any kind of conflict between one’s personal
interest and in the interest of the company. If any such conflict arises it is the duty of a
director to be disclosing and managing the same as has been discussed by the judges in the
case Greenhalgh v Arderne Cinemas Ltd.
Application 1
Applying the decision of the Flugge case in the given scenario it can be observed that
Captin as a chairperson of Avengers Ltd has the duty to be acting with due diligence and
proper care in relation to the exercise of the powers hold by him and the discharge of his
duties as per the provisions of s.180. However, in this case the Captin was seen to be in
breach of his duty as every time he was approached by Ironman for funds necessary the
prototype of the software that the company was working on.