Property Developments Ltd is an unlisted public building development company. The directors are Julian, Sol and Daniel. They believe that given the down turn in property prices, now is the time to acquire land for future property development. Gerald who is the uncle of Julian owns some land in the western suburbs of Melbourne. Gerald is under financial pressure from the bank to repay the loan on the block of land and is therefore keen to sell. Julian is aware of this

The directors of Property Developments Ltd are keen to buy the land. Julian believes it is none of the board's business if the land is bought from Gerald and does not disclose to the other directors his relationship to Gerald. He attends the board meeting and votes in favour of the company acquiring the land for $650,000 which just happens to be the market value as well as the amount of the debt Gerald owes to the Bank.

The other three directors decide to buy the land, and knowing that land prices are depressed they do not bother to get an independent valuation of the property. Three months later the directors learn that the land the company bought from Gerald was prone to flooding and the commercial value was only $200,000.

Julian's brother Raphael is the sole owner and director of an architectural practice company.

Property Developments Ltd wants to engage an architectural firm to design plans for their buildings.

Julian is in charge of getting offers from the various architectural firms. He tells Raphael what each architectural firm is going to charge. This allows Raphael to offer a price which the company accepts. Julian does not attend the board meeting or vote as he was away on holiday at the time. He did not tell the Board that his brother was going to submit a tender.

REQUIRED:

Is Julian obliged to inform the board of his interest in the company's purchase of the land?

What common law duty and statutory duty if any has Julian breached?

What action if any can the other two directors take against Julian?

Have the other two directors breached any common law or statutory duty?

In your answer you are required to refer to relevant legislation and case law