Someone recently bought our

students are currently browsing our notes.


Checklist Directors’ Duties Notes

Law Notes > Business Associations Notes

This is an extract of our Checklist Directors’ Duties document, which we sell as part of our Business Associations Notes collection written by the top tier of University Of New South Wales students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Business Associations Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Directors' Duties: Checklist


1. Duty of Care, Diligence and Skill a. Breach of statute? S 180(1): b. Breach under general law? Ordinary prudent person in co circumstances and director's position (ASIC v Adler) c. Exception for business judgment rule?

2. Duty to prevent insolvent trading: s 588G

3. Duty to act in good faith

4. Duty to individual members

5. Duty to avoid conflict

6. Duty not to derive a secret profit

7. Related party transactions (for a public company) Where there is a possible conflict of interest or a financial transaction with a related party - consider the following possible breaches: Is D liable because of an interest D had in a transaction with their Co?

1. Breach of statutory disclosure obligations in ss 191, 195? Director of a co who has a MPI in a matter that relates to affairs of co must give the other directors notice of the interest unless s 191(2) applies. Consider implications for Criminal liability under s 195 (McGellin; Camelot; Adler)?

2. Breach of fiduciary duty to avoid conflicts? (Perhaps changed by company's constitution)? (Chan; Phipps) Is D liable because he/she profited or harmed company from fiduciary position?

3. Statutory duty of disclosure in ss 182 (regarding use of position), s 183 (use of information), and s 184?

4. Breach of equitable duty to avoid conflicts?
a. Duty applied?
b. Consent?
c. Consequences

5. Breach of any requirements from co's constitution?
D breach other no conflict duties

6. Breach of related party transactions law (public co) ( ss 207230)

7. Breach by not fettering board discretions rule: Thorby v Goldberg

8. Breach by competing with company: Mashonaland Other issues to consider:

9. Breach of duty to take reasonable care, skill and diligence: s 180; GL

10. Breach of duty to prevent insolvent trading: s 588G


Checklist of all the duties General law Daniels v Anderson; Wheeler; Adler; McDonald; Healey (Centro decision) - business judgment exception in s 180(2)

Statute S 180, 189, 190, 198D

Good faith in best interests, for proper purposes

(Re Smith and Fawcett; Harlowe's Nominees; hogg v Cramphorn; Teck; Howard Smith v Ampol; Whitehouse v Carlton; Equiticorp ; Adler; Bell Group)

1. When in corporate group: (Charterbridge; equiticorp; Bell)

Duty to act in good faith in best interests of co and for proper purposes: s 181, 184 Criminal - s 185

2. When in corporate group: (Charterbridge; equiticorp; Bell)

Duty to avoid conflicts

Imperial Mercantile creditor; Transvaal; Thorby v Holdberg; Mashonaland; Zacharia; Adler; Hospital Products;)

Duty not to improperly use position or information for advantage or detriment of company: Ss 182, 183

Duty of Care, Diligence and Skill

Disclosure obligations Duty not to fetter discretion Duty not to Duty to prevent insolvent trading: s 588G For public cos, related party transactions

Ss 191, 195 (Mcgellin v mount king; Camelot)


* Breach of duty of care, diligence and skill: (Both CL and statutory duties are owed by individual directors and officers personally liable for breach) o If breach of statute: compensation proceedings can be founded upon contravention of s 180(1) under s 1317H (Words 'resulted form' in s

Buy the full version of these notes or essay plans and more in our Business Associations Notes.