Street Motors, a listed company, is an importer and retailer of Mercedes-Benz cars and trucks. The directors and their associates
Street Motors, a listed company, is an importer and retailer of Mercedes-Benz cars and trucks. The directors and their associates own about 35 percent of the company's issued shares. Assets Redevelopment Ltd (ARL) owns 9 percent of the shares. The remainder is held by a large group of individual shareholders. At a recent board meeting attended by all directors, it was decided that Street Motors Ltd would sell all the company's showroom sites to White Knight Investments Pty Ltd. Unknown to the other directors, White Knight Investments Pty Ltd was the family company of Frank Street, chairperson of Street Motors Ltd. One of the terms of the sale was that Street Motors Ltd would lease back all the showroom sites from White Knight Investments Pty Ltd. Because no independent real estate valuations had been obtained, the Street Motors Ltd directors were unaware that the sale price was considerably less than market prices and that the agreed lease-back rent was very high. Street Motors refuses to take legal action.
Using ILAC method (including legislation law, common law and cases) - Advise ARL if it can bring a statutory derivative action on behalf of Street Motors Ltd against Frank Street. DO NOT discuss Frank's potential breach of duties under sections 191 and 195 in your answer.