Company law Essay Example | Topics and Well Written Essays - 2000 words - 2

Company law - Essay Exampleision in healthy faith and for meaningful purpose Transaction with other confederation should not reflect soulfulnessal gains To pronounce other members of the board concerning the transaction to seek their confidence. Decision should be rational and in the best entertain of the company. The above requirements argon to be fulfilled by the directors in order to satisfy the statutory occupation of care and due diligence6. Business judgment In accordance of rights with the surgical incision 134 of the Corporations passage, the upper and the bottom layers of the worry should respect the provisions of the Corporations Act and the constitution of the company. The company in its own discretion can view as adept or more replaceable rules contained in the Corporations Act in place of Constitution. In accordance with Section 140(1) (b) of the constitution and replaceable rules have the direct bearing on a Contract that executes amongst the company, each d irector and secretary. Under the mentioned scenario each one agrees to abide by the constitution and the rules in vogue7. present we can take example of Turquands case, according to which, an agent belonging to the company can trade name a contract without any authority, which is not in knowledge of the outsider. A rule is settled that ensures the auspices of outsiders until and unless the security of company is not at stake8. Another case Crabtree-Vickers Pty Ltd v Australian Direct get away Advertising Co Pty Ltd can be taken as an example to show that a person who lacks actual authority cannot be entered into a contract on behalf of the company and prior approval is necessitate for entering into a contract by some person having actual authority not unornamented one9. Sixty-Fourth Throne Pty Ltd v Macquarie Bank Limited 1998 3 VR 133 is another example where Kandy used authority of... The Corporations Act is an important legislation passed by the legislators that governs the companies in Australia. It deals with the issues of formation and operation of companies in line with the constitution of the company determine responsibilities of officers, process of acquisitions, mergers and fundraising.Directors should not deploy themselves in a critical position where they are inefficient to serve in the best provoke of the organization. This inclusive of entering into commercial transactions with other entities where one cannot take decisive part in making a decision for the company. With regard to protect the rights of shareholders in case of oppressive changes in the Constitution by the Board of Directors, we may invoke the provision of section 994 of the Companies Act. According to which A member of a company may apply to the court for an order on the ground that the companys affairs are being run or have been conducted in a panache that is unfairly prejudicial to the interests of its members generally or of some part of its members .The mentioned secti on in fact protects the interest of the minority shareholders in circumstances where the majority shareholders act in a way which is detrimental to the interests of minority shareholders. Moreover, in view the effective role of the Central Bank of Malaysia and the Security Commission of Malaysia, the chances of jeopardizing the interest of shareholders are diminished.