Dr Peter Robinson CQUniversity, Brisbane Campus LAWS20059 / LAWS20029 Corporations and Business Structures Corporate Law Dr Peter Robinson CQUniversity, Brisbane Campus

Module 4 Corporate Constitution

Today’s Overview 1 2 3 A company’s constitution Members’ powers Meetings of members 3

Today’s Overview (continued) Fraud on the minority 4 Oppression of members 5

A company’s constitution Memorandum and articles Replaceable rules Constitution as a contract Actually, 3 contracts:- Between the company and each member Between the company and each officer Between the members and each other

Division of powers Board of directors - management Secretary – corporate matters Members – limited constitutional powers

Member’s powers Changing constitution (special resolution) Changing company name (spec. resolution) Changing company type Appointing/removing directors, auditors Changing share class rights Approving related party transactions

Related party transactions Member approval required for transaction IF: public company (or entity it controls) gives financial benefit to related entity E.g. subsidiaries, officers, their close relatives EXCEPTIONS include (ss.210, 211):- arm’s length transactions; reasonable benefits to officer or employee

Shareholders’ meetings Annual general meetings (AGMs) Compulsory only for public companies Usually called automatically Extraordinary general meetings (EGMs) Called to consider particular resolutions

Calling an Extraordinary GM By a director – ss.249C, 249CA By board at request of members – s.249D By members after failed request – s.249E By members without request – s.249F By order of the court – s.249G

How to call a meeting Notice of meeting Listed companies – at least 28 days’ notice Proprietary and unlisted – at least 21 days Procedural irregularities and s.1322

How to run a meeting Quorum Chairperson Voting by show of hands Voting on a poll Proxies

Workshop Questions Questions 1 to 6

Fraud on a minority Gambotto’s case Expropriation cases Non-expropriation cases

Oppression remedy – s.232 Contrary to interests of company as whole Unfairly prejudicial Unfairly discriminatory Generally oppressive See examples of oppression in lecture notes.

Conclusion Members have limited powers They exercise powers in meetings Minorities can be unfairly treated The common law remedy for this unfairness is fraud on a minority The statutory remedy is the oppression remedy under s.232

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