Conflict Of Interest : Conflict Of Interest In Common Law

In order to prove the breach of section 184, the following rules and duties must have been violated. A director commits an offence if they are reckless or intentionally dishonest, and fail to exercise their powers and discharge their duties in good faith in the best interests of the corporation or for a proper purpose .As mentioned earlier Mr Palmer was reckless in decision making by waving loans and using the company assets for private benefits and the company suffered had to go in voluntary administration. The second offence that needs to the violation of section 184 is that when a director commits an offence if they use their position with intentional dishonesty or recklessly in order to directly or indirectly gain an advantage for themselves, or someone else, or cause detriment to the corporation. Mr Palmer acted as a shadow director and his nephew agreed with all the decisions the corporation made such as political donations and transferring funds to another firms owned by Mr Palmer that caused detriment to Queensland Nickel. The third offence is a person who obtains information because they are, or have been, a director of a corporation commits an offence if they use the information with intentional dishonesty or recklessly. As

RULE OF LAW: Corporate promoters owe a fiduciary duty to one another, the company, its

Common law rights were guaranteed by the Magna Carta or Great Charter, which were affirmed in 1215 by King John. One did not have to be born into privilege to have common law rights, however, those who were had even more rights. There were times that the king and parliament disagreed as the “king claimed larger areas of power, leading to a bitter conflict between them.” according to Benedict (p. 1). The term “common law” means “…government protection against the encroachments of the rich and powerful,” according to Benedict (p. 2).

Woodward, S., Bird, H. & Sievers, S. (2005). Corporations Law in Principle 7th ed. Pyrmont, NSW: Lawbook Co.

In many misfeasance cases against directors, those breaches maybe relatively uncontroversial. This draws into focus the question of whether the director has any common law or statutory defence, including the Duomatic principle and ratification by shareholders (CA 2006 S.239), available to a claim against him for restitution to the company. S.239(6)(a) preserves the Duomatic rule that if an informal unanimous consent is reached among voting shareholders, it is unnecessary to pass such ratification resolution through general meeting or written resolution. The first part will examine the scope and requirements of this rule to illustrate the validity of such assent. S.239(7) leaves the door open for rules of law, which refers to common law principles, to continue guiding ratification. It will be assessed how these rules impose limitations on the general ratification power conferred by s.239.

According to the pro and contra Section 203D and 203E of the Corporations Act as above, most judges and scholars agree that the procedure of removal directors as stipulated in the Corporations Act provides fairness treatment for the directors who may be removed. However, they still strongly argue whether the Section 203D is mandatory or not. Moreover, they questioned the existence of Section 203E since it eliminates flexibility for companies to make decision particularly in the emergency situation as explained above. Therefore, in order to provide broader perspectives about the relevancy of Section 203D and Section 203E, it is necessary to compare the procedure of removal directors in the Australian legislation with the

According to UK Law, the directors should act in good faith in the interest of the company, and exercise care and skill in carrying out their duties. The Company Law Reform Bill (2005) defines, in section 154-161, the directors’ duties as follows:

conflicts of interest can have long lasting detrimental affects on the company. To this end,

In the event that I would join one of these organizations, I would join Lawyers' Committee for Civil Rights Under Law. I would go along with this organization since I want to be a lawyer and I think being a civil lawyer would be best for me. The chief mission of the Lawyers' Committee for Civil Rights Under Law is to secure equivalent equity for all through the guideline of law, focusing specifically the disparities facing African Americans and other racial and ethnic minorities. The Lawyers' Committee is an unprejudiced, philanthropic association, framed in 1963 at the solicitation of President John F. Kennedy to enroll the private bar's authority and assets in fighting racial segregation and the subsequent imbalance of chance – work that

“A conflict of interest arises when a trustee has an interest that conflicts with the interest of the organization”. (American Medical Association, 2010).

There is a conflict of interest involved between the two parties. As mentioned in the Business Corporation Act of Ontario which claims that every director and officer of a corporation within his powers act honestly and in good faith and must vote in best interest of the corporation. Also, the director should exercise the care, diligence and skill that a reasonable person would exercise in this situation.

The removal of a director by the board in the FDC case creates legal and ethical issues, which ultimately led to the onset of commercial issues. Despite the legal, ethical and commercial issues, this case is strongly indicated that there are some problems in the mechanism of removal directors stipulated in the Corporations Act 2001 (Cth) (“Corporations Act”) S 203D and S 203E. This indication is underpinned by some cases in the Australian court in which directors are removed also by the board. Therefore, this paper will analyse the legal, ethical and commercial issues regarding with the removal of FDC’s director, discuss the problem in the procedure of removal directors stipulated in the legislation, and compare other regulations in the common law and civil law countries. Finally, drafts of new mechanism of dismissal directors will be provided in this research to reform Section 203D

Conflict of interest is a “situation in which a person has a private or personal interest sufficient to appear to influence the objective exercise of his or her official duties as, say, a public official, an employee, or a professional.” (Chris MacDonald, Aug 2002) If left unchecked conflict of interest can put an individual in ethical and legal trouble. Conflict of interest usually occurs when a person’s personal interest is in conflict with his/her duty or employment. Conflict of interest is common in academia and the workplace because unscrupulous individuals can be easily corrupted. In this self-assessment assignment, I will discuss a time I have been in a conflict of interest and how it was resolved. When you find yourself in a conflict of interest it is important to ask “is this the right thing to do?” and “is what I am doing ethical?” Human beings are becoming more disconnected from personal interaction because of the internet and new technologies. This can cause a “me first” mentality among people, enabling unethical behavior and possible conflict of interests.

The good corporate governance is regulated by the Australian Securities and Investment Commission (ASIC), which include specific director's duties that director must follow to enhance the well practice within the

Provision B.1.1 states “The Board should state its reasons if it determines that a director is independent notwithstanding the existence of relationships or circumstances which may appear relevant to its determination, including if the director: has received or receives additional remuneration from the company apart from