Katie Mcdermott is a retired entrepreneur. She holds a significant number of shares in Nimble Technologies Pty Ltd. Katie has been quite unhappy about the management of the company, particularly as it seems that directors have had pay increases each year, and seem to have significant benefits in the form of cars, trips and various other expenses paid on their behalf. Katie suspects that the directors are acting generally for their own benefit, and not in the interests of all shareholders. She is particularly interested in how certain shareholders have increased their holdings, and whether the company has been assisting a particular group of shareholders at the expense of the shareholders in general. While Katie has asked various questions at company meetings, she is not satisfied with the answers she has received. She believes there may be a case for bringing an action against the directors under some part of the Corporations Act. Katie needs to gather some information so that she can determine whether to bring an action for oppression or perhaps a statutory derivative action against directors who are misusing their position. Explain with reference to specific sections of the Corporations Act 2001 (Cth): (Maximum 300 words) a) What are the means that Katie might attempt to use to gather information about the company, in order to consider her options in taking action? b) If Katie does find that the company is acting unfairly or prejudicially against some members, what type of action can she instigate

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Katie Mcdermott is a retired entrepreneur. She holds a significant number of shares in Nimble Technologies Pty Ltd. Katie has been quite unhappy about the management of the company, particularly as it seems that directors have had pay increases each year, and seem to have significant benefits in the form of cars, trips and various other expenses paid on their behalf. Katie suspects that the directors are acting generally for their own benefit, and not in the interests of all shareholders. She is particularly interested in how certain shareholders have increased their holdings, and whether the company has been assisting a particular group of shareholders at the expense of the shareholders in general. While Katie has asked various questions at company meetings, she is not satisfied with the answers she has received. She believes there may be a case for bringing an action against the directors under some part of the Corporations Act. Katie needs to gather some information so that she can determine whether to bring an action for oppression or perhaps a statutory derivative action against directors who are misusing their position. Explain with reference to specific sections of the Corporations Act 2001 (Cth): (Maximum 300 words) a) What are the means that Katie might attempt to use to gather information about the company, in order to consider her options in taking action? b) If Katie does find that the company is acting unfairly or prejudicially against some members, what type of action can she instigate?

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