06. Directors' duties. Flashcards
Directors’ duties: A* P P I A N D
act within powers
Directors’ duties: A P* P I A N D
perform duties with reasonable care, skill and diligence
Directors’ duties: A P P* I A N D
promote the success of the company
Directors’ duties: A P P I* A N D
independent judgement
Directors’ duties: A P P I A* N D
avoid conflicts of interest
Directors’ duties: A P P I A N* D
not accept benefits from third parties
Directors’ duties: A P P I A N D*
declare any interest in a proposed transaction or arrangement
A director not ‘acting within powers’ may nevertheless be deemed not to be in breach of duties if …
their action is subsequently ratified by the company in general meeting.
Directors allotting shares for the purpose of diluting the voting power of an existing majority …
will be deemed in breach of their duty to ‘act within powers’
see Howard Smith v Ampol (1974)
Directors allotting shares, this action being subsequently ratified by members in general meeting …
will not be deemed in breach of their duty to ‘act within powers’
see Bamford v Bamford (1969)
The duty to avoid conflict of interest is satisfied so long as … have authorised the matter.
the board as a whole
The default for a public company is that the board of directors can only authorise potential conflicts of interest …
if its articles expressly permit it
The default for a … company is that the board of directors can only authorise potential conflicts of interest if its articles expressly permit it.
public
The default for a private company is that the board of directors can authorise potential conflicts of interest …
unless its articles prohibit it
The default for a … company is that the board of directors can authorise potential conflicts of interest unless its articles prohibit it.
private
