The Constitution and Replaceable Rules Flashcards
What are 3 ways a company can govern their admin?
- Own constitution
- RR
- Or both
Under which section allows members to reapeal or modify company Consti?
- s136(2)
What are RR?
- Rules that are default governance in the Corps Act that apply to most public and private companies
Does RR or Consti take precendence?
- Constitution
Which cases show that Consti override RR?
- Easton Mining AND Wambo Coal
What is a Section that Public Companies MUST FOLLOW?
- s249X
If we fail to comply w applicable REPLACEABLE RULE what happens?
- Not a contravention of Corps Act –>
- s1324 allows for person to seek injunction but RR is NOT considered a contravention of act
–> Means CONTRACT LAW may be involved as opposed to Corps Law
Do RRs apply to One-Person companies?
NO, does not need a consti either
–> Corps Act sets out small number of sections One-Person companies must follow
When do RRs become applicable for a company?
- As soon as its more than 1 SHAREHOLDER
- OR MORE THAN 1 DIRECTOR
Do ‘Liability Companies’ have RR and Consti?
- Liability Companies have BOTH –> Consti stating purpose of Liability Companies is for ‘mining purposes’
What was the requirement PRIOR to 1998
ALL companies had to have a constitution –> memorandum and articles of association
What are 3 ways a company may adopt a constitution?
- Person named on application for company’s reg as having consented to write terms of consti
- Company that is registered without a constitution may adopt one by passing a special resolution
- Court order is made under s233 that requires the company to adopt a consti
Steps for Public Companies to adopt a consti?
- Lodge a copy w ASIC –> within 14 days
- If MEMBER sends a copy to ASIC –> within 7 DAYS
What is an object clause?
- Purpose to carry out a joint venture or not-for-profit purposes
- IDENTIFIES OBJECTS of a company
What was Doctrine of Ultra Vires?
- Company contract or transaction NOT within the scope of its objects was ‘Ultra Vires’
Which case ABOLISHED Ultra Vires?
Hillig v Darkinjung
Can Members force company to comply w Consti?
Yes
Can members act OUTSIDE their capacity?
NO (UNLESS)
- Show that company is NOT acting in the best interests and is oppressive or unfair
Can NON MEMBERS enforce Consti?
NO –> Forbes v NSW Trotting
What are some Statutory Requirements to alter a Consti or RR for PTY LTD?
- Special Resolution with at least 75% of members
- Requires notice of meeting at which special resolution is proposed to set out an intention to propose the special resolution
What are some Statutory Requirements to alter Consti or RR for a PUBLIC COMPANY?
- Lodge with ASIC within 14 days of amendment
- Must be within 7 days if EMPLOYEE does it
Why are there restrictions for altering Consti?
- To ensure that the power to ALTER consti/RR isn’t simply for Personal Gain
