Render Mechanics Ltd (Render) is a small public company that designs and markets industrial components for...

 

  

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Render Mechanics Ltd ("Render") is a small public company that designs and markets industrial components for a range of clients. Render has 3 executive directors on its Board. These 3 executive directors also manage a subsidiary of Render called Mender Mechanics Pty Ltd ("Mender"); they are additionally shareholders in both companies, Render and Mender. During August of 2020, the Board approves for Mender to contract with another company, Big Sale Pty Ltd, for the purchase of goods to the value of $500K. In due course, Big Sale Pty Ltd fails to deliver the goods to Mender, and Big Sale does not refund any of the $500K to Mender. For some reason, the 3 directors of Mender decide not to take legal action against Big Sale Pty Ltd for breach of contract. When queried about this by other shareholders in Mender, the directors simply state, "it would not be an advisable course of action". The decision not to sue results in a major loss for Mender that also has a serious financial impact upon Render (as Render is the holding company of Mender). The minority shareholders of both Render and Mender are concerned with the way the company is being run by the 3 directors, and so they seek legal advice. Question 1: Answer both A, B and C (25 marks) A) Outline how a company such as Mender may directly contract with other persons. Make sure you refer to any relevant sections from the Corporations Act 2001 (Cth) (5 marks). also has a serious financial impact upon Render (as Render is the holding company of Mender). The minority shareholders of both Render and Mender are concerned with the way the company is being run by the 3 directors, and so they seek legal advice. Question 1: Answer both A, B and C (25 marks) A) Outline how a company such as Mender may directly contract with other persons. Make sure you refer to any relevant sections from the Corporations Act 2001 (Cth) (5 marks). B) Have the directors breached their duties to either Render or Mender? Make sure you answer using IRAC structure and refer to any relevant sections from the Corporations Act 2001 (Cth) and case law (10 marks). C) Identity the possible members remedies that the minority members could seek against either Render and/or Mender. Make sure you answer using IRAC structure and refer to any relevant sections from the Corporations Act 2001 (Cth) and case law (10 marks). Render Mechanics Ltd ("Render") is a small public company that designs and markets industrial components for a range of clients. Render has 3 executive directors on its Board. These 3 executive directors also manage a subsidiary of Render called Mender Mechanics Pty Ltd ("Mender"); they are additionally shareholders in both companies, Render and Mender. During August of 2020, the Board approves for Mender to contract with another company, Big Sale Pty Ltd, for the purchase of goods to the value of $500K. In due course, Big Sale Pty Ltd fails to deliver the goods to Mender, and Big Sale does not refund any of the $500K to Mender. For some reason, the 3 directors of Mender decide not to take legal action against Big Sale Pty Ltd for breach of contract. When queried about this by other shareholders in Mender, the directors simply state, "it would not be an advisable course of action". The decision not to sue results in a major loss for Mender that also has a serious financial impact upon Render (as Render is the holding company of Mender). The minority shareholders of both Render and Mender are concerned with the way the company is being run by the 3 directors, and so they seek legal advice. Question 1: Answer both A, B and C (25 marks) A) Outline how a company such as Mender may directly contract with other persons. Make sure you refer to any relevant sections from the Corporations Act 2001 (Cth) (5 marks). also has a serious financial impact upon Render (as Render is the holding company of Mender). The minority shareholders of both Render and Mender are concerned with the way the company is being run by the 3 directors, and so they seek legal advice. Question 1: Answer both A, B and C (25 marks) A) Outline how a company such as Mender may directly contract with other persons. Make sure you refer to any relevant sections from the Corporations Act 2001 (Cth) (5 marks). B) Have the directors breached their duties to either Render or Mender? Make sure you answer using IRAC structure and refer to any relevant sections from the Corporations Act 2001 (Cth) and case law (10 marks). C) Identity the possible members remedies that the minority members could seek against either Render and/or Mender. Make sure you answer using IRAC structure and refer to any relevant sections from the Corporations Act 2001 (Cth) and case law (10 marks).

Answer rating: 100% (QA)

Answer Explanation Part A From the Corporation Act 2001 Cth Render Mechanis LTD a company m... View the full answer