Directors Duties - Case Analysis of ASIC v Padbury Mining Limited [2016] FCA 990

Running head: DIRECTORS DUTIES
Directors Duties
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DIRECTORS DUTIES
Table of Contents
Introduction......................................................................................................................................2
Facts of the case...............................................................................................................................2
The contravened directors duties.....................................................................................................3
Court Decision Analysis..................................................................................................................4
Future implication in relation to the decision which have been made by the court in this case......8
Conclusion.......................................................................................................................................8
References......................................................................................................................................10

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DIRECTORS DUTIES
Introduction
When an individual is assigned as an officer or a director of the company, then they are forced
with many obligations by the common law and also the required provisions which they need to
detect while fulfilling the responsibilities. Such obligations are often known as the directors’
duty. One of the duties which the director have with respect to the company, is which they need
to have a least level of diligence and care at the time when they are fulfilling the responsibility.
Such specific duties are also declared clearly in the provisions under s. 180 of Corporation Act
2001 (Cth), and also some consequential cases of the common law. During the time the directors
are seen to be failing in the provided duties then they are seen to be charged by the provisions, in
which they are penalized by financial penalties and also suspension. ASIC v Padbury Mining
Limited [2016] FCA 990 case also was regarding similar responsibilities mentioned above.
Facts of the case
This case is regarding an announcement which was done by the company in relation to the
disclosure obligations under the CA which an entity listed with the Australian Securities
Exchange have. The court in the following case prohibited the directors of the company who
were involved in this case and the ban was for 3 years. The court further declared a penalty of
sum of $25,000 considering the violation of the act. The directors are said to be responsible for
violating the s. 180 as were not able to stop the company from stating an announcement in which
it said that they are going to get a fund of amount $6 million, they were getting the fund as they

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DIRECTORS DUTIES
were moving out a project of construction in the Western Australia. The announcement was
declared on 10th April 2014, and contained the terms as follows.
• Securing the funds for the Western Australia project was done successfully by the
company.
• The funds were provided on the terms which were included in the agreement regarding
the shareholders and were provided by the private investor.
• This project was declared to be expanded by the Midwest Infrastructure Pty Ltd.
The company had failed to declare while making the announcement that they yet required
abiding with the terms which were mentioned in the agreement for the cause of obtaining the
funds which they required for the Western Australia project. The terms stated that to acquire a
sum of $1.3 billion as bank guarantee earlier too the time when they can be allowed for getting
the needed amount for the Western Australia project.
The organization had aimed at the Australian security exchange to stop the trading of shares with
the company later which again requested to rise. Within that time interval almost 200 Million of
shares of that company were already traded. When the company did the trading at quick prices
they made a declaration that their agreement with respect to the financer has been ended.
The contravened directors duties