Roger's Duty Case Study

(1) At any meeting held for the election of directors the stockholders are so divided that they have failed to

* Roger is in a position that requires him to make sound and objective decisions for the good of the company. Avoiding making important decisions will put his managerial skills into question.

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.

Chevron’s decision not to pursue litigation against some directors was within the business judgment rule. As mentioned in the case “the three Board members who comprised the Committee were appointed to the board after the alleged wrongful conduct had occurred.” These facts were sufficient for Chevron to establish that the Board, acting through the committee, made informed and reasonable decision (duty of care) and acted in good faith and in what they believe to be in the best interest of Chevron (duty of loyalty) to stop further pursuit of the matter in question and seek dismissal of the action, thus activating the presumption of the business judgment rule.

There were a number of factors which were considered by His Honour in finding against the executive and non-executive directors and executives of the James Hardie Group, including the experience, sophistication and intelligence of the directors, the nature of the company and the significance of the restructure, and the fact that the non-executive directors were given considerable professional advice in connection with the restructure.

Usually in corporations there is a clear distinction between the people who take critical decision – Board of Directors – and the people who actually execute the decisions – management. In FBM, many managers were also part of the Board. This arises conflicts of interest. This should be avoided.

Firstly, the role of a director is important because they have to make sure they have someone that can manage all aspects of the company and they can make sure

Directors usually have the responsibility of administration, programming, advertising or marketing, fundraising, and backstage jobs behind the curtains. Their

In 2002 the Hershey trust company board decided to sell school shares from Hershey stock. The board wanted to sell the 33% of Hershey shares at premium and reinvest the money in another company to make profit for the school. The board was responsible to oversees the investment and make sure the school was doing fine. Looking on this issue as financial personnel the board decision was better to sell stocks at premium and reinvest in another company.

The prosecutor in the case stated his view clearly after the verdict and sentence were pronounced. He was accurate. It was a case of betrayal, he said, "betrayal of CEO's who betrayed the shareholders."

First of all, the definition of a director should be confirmed before talking about the duties of director. In Section 9 of the corporations, director can be defined as a person who in accordance with whose instruction the board is accustomed to acting, that is, a shadow director. In Standard Chartered Bank of International Ltd v Antico (1995) 38 NSWLR 290 , the court found that Pioneer was a

A discourse community comprises of a group of people sharing a common and distinct mode of communication or discourse, especially within a particular domain of intellectual or social activity (Oxforddictionaries, 2017). Some of the discourse communities I consider to be a part of, include an Indian joint family, my peer group, high school education in India, the Apple community and education at Pace university.

Here we see a failure of the board to look at management critically. They accepted only the information presented to them by the CEO and did not demand a better picture on the state of RBS’s business in mortgage trading even while the CEO’s story seemed to constantly be changing. The board exists as a watchdog to the executive management yet nothing was done to hold the CEO accountable to the truth.

The Court of Appeal also ruled against Mr. Salomon, on the grounds that Mr. Salomon had abused the privileges of incorporation and limited liability, which the Legislature had intended only to confer on "independent bona fide shareholders, who had a mind and will of their own and were not mere puppets". The lord justices of appeal variously described the company as a myth and a fiction and said that the incorporation of the business by Mr. Salomon had been a mere scheme to enable him to carry on as before but with limited liability.

The appointment of independent directors became very necessary, as shareholders looked for a way by which management became more responsible and accountable, and as such; the need for independent directors, who would not only checkmate the excesses of the board of directors, but also have the interest of the company and the shareholders at heart.