(a)  Explain to Sonia the proper plaintiff rule and the internal management rule. Corporations Act 2001 (Cth), including the procedures she may need to follow to obtain those remedies.

(b)  Sonia seeks your advice on whether there are any remedies available to her under the Sonia, Chris and Debbie are the only directors and shareholders of King Pty Ltd, which owns and operates the King's tavern. Sonia is the only non-executive director of the company. The company has 9000 ordinary shares that are fully paid up. Each shareholder holds 3000 shares. Chris and Debbie are married to each other and are also part owners of Duke Financial Brokers.

King Pty Ltd has been very successful but has not paid a dividend for the last 5 years. Profits have instead been invested in financial products. Sonia is 60 years old and her husband is ill. She requests Chris and Debbie for the company to commence paying a dividend, but instead Chris and Debbie successfully pass a resolution at a members' meeting to remove Sonia as a director. Sonia wishes to sell her shares, but, Chris and Debbie refuses to buy them. On further investigation Sonia discovers that King Pty Ltd has been inappropriately paying large "management fees" to Duke Financial brokers without any justification of work done.

Answer rating: 100% (QA)

a plaintProperiff rule is a key rule in the corporate or business law which first came through after the precedent was set by Foss v Harbottle Proper ... View the full answer