Corporate Law: Equitable and Statutory Remedies for Breach of Director's Duty

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

CORPORATE LAW1
My understanding of the essay question is that I have to find out whether Tim is eligible for
the grant of any equitable or statutory remedy under the contract law of Australia. If yes then
what type of remedies is he eligible for.
The primary authorities I plan to refer to in my essay are:
 Atlasview Ltd v Brightview Ltd [2004] 2 BCLC 191
 Australian Securities and Investment Commission Act 2001
 Gamlestaden v Baltic Partners Ltd [2007] 4 All ER 164 at 172
 Maher v Honeysett and Maher Electrical Contractors Pty Ltd [2005] NSWSC 859 at [29]
 Nicholls v Michael Wilson & Partners Ltd [2012] NSWCA 383
 The Corporations Act 2001
 Youyang Pty Ltd v Minter Ellison Morris Fletcher [2003] HCA 15; (2003) 212 CLR 484
at [44]
 Co-Operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1998] AC 1
The secondary sources I plan to refer to in my essay are:
 Auditing: A Journal of Practice & Theory, 35(1) by Stewart, Kent, and Routledge 2015
 McKendrick, E., 2014Contract law: text, cases, and materials by McKendrick 2014
 Exemplary Damages: A Genuine Concept by Vaclav Janecek 2013
In my essay I plan to argue that the brothers were in breach of directors’ duties against
Tim. In this essay the rights of Tim in availing equitable remedies and statutory remedies for the
breach of director’s duty will be discussed in detail. In the given case it can be seen that five
brothers created a cafe named The Grumpy Grande Pty Ltd (TGG). In the constitution of the
company it was mentioned that the company specializes in delivering fresh brewed coffee to

CORPORATE LAW2
various corporate, sporting or social events. The constitution of the company stated that the
decision making process of the company would be done by majority votes. In the constitution it
was further mentioned that the five brothers would be the sole directors and shareholders of the
company. Further the shares of the company were only to be sold with permission of other
directors and that sell can only be internal within the directors. The business was in its initial
stage very successful. However after a few years the business started to deteriorate which
resulted in a strain in relationship between the five brothers. Four of the brothers suspected that
the youngest brother, Tim, was planning to leave the company and started to bully him by
blocking all his business ideas with the help of majority votes. The brothers further sold the
valuable assets of the company at a bargain price among themselves ignoring every protest of
their youngest brother.
After a few days it was overheard by Tim his older brother was planning to block his
shares from selling by majority vote. He further heard his brother stating that if they can make
Tim angry he would walk out of the company on his own and the brothers would not have to pay
him anything.
In the law of contract there are certain remedies available to the aggrieved parties for
every breach of contract. In the Competition and Consumer Act 2010 (Cth) provisions for claim
of remedies against the breach of contract are being mentioned. The provisions for statutory
remedies are mentioned in the section 12GM of the Australian Securities and Investment
Commission Act 2001 and in the section 76 of the National Credit Code. In furtherance sections
232, 233, 234 and 236 of the Corporations Act can be taken into consideration for this case. A
court under section 233 of the Corporations Act can make an order in accordance with section
232 of the same act if it finds that there is a contradiction to any member’s interest there is an