THE CORPORATIONS LAW
PART 13 - THE CORPORATIONS LAW
THE CORPORATIONS LAW 82 The Corporations Law is as follows:...
CHAPTER 2F - MEMBERS' RIGHTS AND REMEDIES
PART 2F.1A - PROCEEDINGS ON BEHALF OF A COMPANY BY MEMBERS AND OTHERS
(i) at least 14 days before making the application, the applicant gave written notice to the company of the intention to apply for leave and of the reasons for applying; or
(ii) it is appropriate to grant leave even though subparagraph (i) is not satisfied.237(3) [Presumption] A rebuttable presumption that granting leave is not in the best interests of the company arises if it is established that: (a) the proceedings are:
(i) by the company against a third party; or
(ii) by a third party against the company; and(b) the company has decided:
(i) not to bring the proceedings; or
(ii) not to defend the proceedings; or
(iii) to discontinue, settle or compromise the proceedings; and(c) all of the directors who participated in that decision:
(i) acted in good faith for a proper purpose; and
(ii) did not have a material personal interest in the decision; and
(iii) informed themselves about the subject matter of the decision to the extent they reasonably believed to be appropriate; and
(iv) rationally believed that the decision was in the best interests of the company.The director's belief that the decision was in the best interests of the company is a rational one unless the belief is one that no reasonable person in their position would hold. 237(4) [Interpretation] For the purposes of subsection (3): (a) a person is a third party if:
(i) the company is a public company and the person is not a related party of the company; or
(ii) the company is not a public company and the person would not be a related party of the company if the company were a public company; and(b) proceedings by or against the company include any appeal from a decision made in proceedings by or against the company.
Note:
Related party is defined in section 228.This information is provided by CCH Australia Limited Link opens in new window. View the disclaimer and notice of copyright.