Articles

Removing a nominee director

The rules regulating a company are contained within the Corporations Act 2001 (Cth), the constitution that may be adopted to govern the operations of the company and a shareholders agreement. The importance of consistency between all of these documents, and...

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Insolvency and the right to terminate contracts

Reforms to insolvency laws which commenced on 1 July 2018 prevent contracting parties from relying on certain termination clauses in commercial contracts. The ipso facto regime aims to give companies facing financial difficulties an opportunity to trade their way out...

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Franchising Code changes are coming

Franchise agreements are governed by the Competition and Consumer (Industry Codes – Franchising) Regulation 2014 and the Franchising Code of Conduct (the ‘Code’). The Code is regulated by the Australian Competition and Consumer Commission which has the power to...

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Franchisors must act in good faith and reasonable cause

A franchise operates within an existing business structure that gives the franchisor discretion to implement strategies, introduce new products and set prices for the ‘branded’ goods or services. These commercial decisions however must be exercised in ‘good faith and...

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Lessons for Financial Services Licensees

The Federal Court of Australia recently considered the ‘best interests and appropriate advice duties’ required of financial services licensees and providers, which form Part 7.7A of the Corporations Act 2001 (Cth) (the Act). The Australian Securities and Investments...

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The risks in referring to unattached documents in an agreement

It is very common for parties to an agreement to refer, in the agreement itself, to additional documents. These additional documents are not always annexed or attached to the actual agreement. The Federal Court has held that although a particular enterprise agreement...

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Is one director’s signature sufficient in an agreement?

Dealing with company officers Section 129 of the Corporations Act 2001 (Cth) provides that a third party is entitled to assume that the ‘representative’ with whom they are dealing is validly appointed and has authority to act and to perform the duties customarily...

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Diverting business opportunities – when is it ok?

A director’s obligations are determined by statute under the Corporations Act 2001 (Cth) and by his or her fiduciary duties under the general law. Amongst these obligations is a duty to avoid conflicts of interest. It is commonly accepted that a conflict of interest...

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Why you should read online terms and conditions

The inclusion of terms and conditions in online transactions Traditionally, contracts were formed where parties met and exchanged signed documents containing the terms of the agreement. With the spread of e-commerce, many contracts are now paperless and are accepted...

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Traps for so called ‘Sophisticated Investors’

Generally, when companies raise funds by offering shares to the public they must have available to prospective investors certain disclosure documentation prescribed by the Corporations Act 2001 (Cth) (the Act). The type and extent of disclosure depends on the...

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Replacing Appointors of Discretionary Trusts

Discretionary trusts can be an excellent vehicle for the management and distribution of assets and income and also for the transfer and preservation of wealth for the benefit of successive generations. However, as family structures become ever more complex and people...

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Does size matter? David v Goliath

Many small practices label themselves as “boutique” or “specialist” practices. But, not every small practice is a specialist. Specialist firms are consciously structured with a low partner to professional staff ratio and operate within a clearly defined sphere of...

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When can an employee’s knowledge be attributed to the company?

Commonwealth Bank of Australia v Kojic [2016] FCAFC 186 considered whether the conduct of two bank employees could be ‘aggregated’ to bring a finding of unconscionable conduct on the part of the bank under the (previous) Trade Practices Act 1974. The facts Mr and Mrs...

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When post-employment restraints are too broad

The Victorian Court of Appeal recently revisited the enforceability of restraint clauses in employment contracts. Just Group Limited (ACN 096 911 410) v Nicole Peck [2016] VSCA 334 considered an appeal from a Supreme Court decision (Just Group Limited v Peck [2016]...

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To be Grill’d or not Grill’d?

The case of Bainbridge Grill'd Pty Ltd & Ors v Simon Crowe & Ors before the Federal Court illustrates the potential pitfalls of not having a shareholder agreement. Grill’d opened its first restaurant in 2004, the brainchild of friends Simon Crowe, Simon McNamara and...

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Did Manly Sea Eagles Drop the Ball?

A recent case involving Jordan Latham, an aspiring rugby league player and his employer, the Manly Warringah Sea Eagles, demonstrated that courts may look at the intentions in correspondence between the parties to determine if an agreement has been formed. Facts Mr...

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