According to australian law
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Answer all 4 questions HA3021 Corporations Law, Tri 3 2011 A, B, C and D are directors and shareholders of a company; A is the managing director. A, B, C and D own equal shares amounting to 40% of the company; E owns the remaining 60% shares. A has always been issuing cheques with a co-signatory, with any other director. One day, he decided to buy a new company car to replace his old one, and bought himself a new Mercedes Benz. He signs the cheque alone to pay for the Mercedes Benz. However, B, C and D were unhappy with this and decided to spend some company monies too. So, they went out to buy for themselves, and for their families, first class holiday packages to Europe, India and China. The company has 30 days credit from their travel agent. However, when these were due, A decided not to pay for B, C and D’s holiday packages. In the meantime, it was discovered that the secretaries of B, C and D, have also bought travel packages for themselves. These were bought from the same travel agent who has supplied the company all their past travel needs. A does not want to pay for the secretaries’ holiday packages too. The agent is now threatening to sue the company. Question 1: Advice A. The above matter was brought to the attention of E and she is furious. She decides to step in and manage the day-to-day affairs of the company. She immediately fires A, and said to him he has to pay back for the cost of the Mercedes Benz out of his own pocket. E then calls for a general (extraordinary) meeting giving the members 7 days notice. She told B, C and D that she intends to fire the entire board in that meeting. She said she will be the sole director for the company. On hearing this, B, C and D have secretly meetings with each other. They agreed that they will authorise each others cheques (for their holiday packages) before they were fired. In addition, B, C and D ordered LCDs, DVDs and laptops from their mate’s shop. They know this mate well told him he has to quickly deliver…



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