Melbourne Law School - Research Publications
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ItemThe best interests duty and corporate charities: The pursuit of purpose(LexisNexis, 2021)Most Australian charities are incorporated. Yet most directors, legal advisers and commentators are hard pressed to articulate a fairly fundamental obligation of charity directors: to act in good faith in the best interests of their corporation. At a time when shareholder primacy is being increasingly questioned for for-profit corporations and consideration of stakeholders or purposes is being written into corporations legislation in other jurisdictions, there is even greater need to think about what interests ought to be considered by charity directors. We argue that to act in the best interests of an incorporated charity means to act in a way that the directors genuinely believe will advance its purposes. As this is still a fairly amorphous standard, we suggest that it can be given content by means of directors’ obligations to give genuine consideration in the exercise of their powers in seeking to advance the corporation’s purposes.
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ItemSpecial Issue on the Australian Law Reform Commission Legislative Mapping Project [Overview](Thomson Reuters (Professional), 2021-06-23)Simplifying the law is not a straightforward task. As Commissioner Hayne noted in his Final Report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Financial Services Royal Commission), the task can only begin after examining how the existing law fits together and identifying the policies given effect by the law's various provisions.[1]
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ItemRegulating for Loyalty in the Financial Services Industry(Thomson Reuters (Professional), 2021)A series of scandals in the financial services sector over the past 12 years has inspired concerted legislative action to protect customer interests. The Future of Financial Advice, Stronger Super, Protecting Consumers and Member Outcomes initiatives have each sought to reform the duties of loyalty, as variously expressed, owed by the providers of financial advice, superannuation funds and mortgage broking services to their customers. This article compares the legal regimes emerging from those initiatives with each other and with three other, analogous regimes: that applying to registered managed investment schemes, that applying to life insurers, and that applying to corporate directors generally. It finds that, although similarly motivated, both the substance and the modality of the regimes vary. This variation needs to be acknowledged and respected when considering the operation of the regimes.
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ItemLegislative Design – Clarifying the Legislative Porridge(Thomson Reuters (Professional), 2021)Legislative design directly affects the clarity, coherence and navigability of legislation. It is therefore of critical importance to regulated persons and entities as they seek to comply with legislative requirements, and to regulators and courts as they seek to interpret and apply them. Calls over many years for legislation governing corporate and financial services law in Australia to be simplified were reinforced by the Financial Services Royal Commission Final Report of 2019. The report recommended that, as far as possible, exceptions and qualifications to generally applicable norms of conduct be eliminated and that legislation identify expressly the fundamental norms of behaviour in respect of rules. These calls recently culminated in the commencement of a review into the legislative framework for corporations and financial services regulation by the Australian Law Reform Commission. This article examines the context behind these calls and engages with the ongoing debate about legislative design and simplification of law. In addition to outlining the issues, the article provides the context for the articles that follow in this Special Issue.
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ItemStatutory duties and ratification: Untangling the maze(LexisNexis, 2021)In 2010 leading corporate law scholar, Robert Austin, called for Australia to follow the UK’s lead in codifying directors’ duties. In addition to criticising the uncertainty and complexity of Australian law on directors’ duties, Austin lamented the lack of clarity concerning the extent to which shareholders in general meeting may authorise or ratify breaches of the general law and statutory duties, which he considered to be ‘quite obscure and unsatisfactory’.
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ItemCharitable Companies and Related Party Transactions(Thomson Reuters, 2021)In response to a recommendation by the Panel reviewing the Australian Charities and Not-for-profits legislation, the Federal Government has announced that charities will be required to disclose related party transactions. The problem of related party transactions is a common theme in the ACNC’s compliance reports. This article critically analyses the issue of related party transactions within the Australian charities sphere, as well as potential reforms. It concludes that reporting of such transactions is the most sensible first step but that further attention should be given to the contours of such reporting.
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ItemPurpose-based Governance: A New Paradigm(Law School, University of New South Wales, 2020-09)The permissibility of corporations pursuing purposes other than profit has been the subject of debate for a number of years. This debate has intensified recently with proposals to allow or mandate the adoption of purposes by corporations. At the same time, purpose is central to governance in the charitable sphere. This article proposes a model of ‘purpose-based governance’, which offers significant potential advantages in both the charitable and for-profit spheres, as well as forming the basis of a unifying governance paradigm.
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ItemUse of the Corporate Form for Public Benefit - Revitalisation of Australian Corporations Law(Law School, University of New South Wales, 2020)This article specifically addresses the theme of revitalisation of Australian law in the facilitation of purpose-based companies. It is the second of two articles on purpose-based governance in the charitable and for-profit spheres. Building on the first article, this article critically analyses relevant features of the Australian corporations law regime. It pays close attention to challenges relating to the application of directors’ duties where companies have multiple purposes and to the drafting of appropriate constitutional provisions. In so doing it draws on insights from overseas jurisdictions that have enacted legislation to enable purpose-based companies.
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ItemConflicts and Coherence in the Charities Sphere: Would a Conflict by any Other Name Proscribe the Same?(LexisNexis, 2020)Proscriptions on conflicts of interest have long been a core component of governance regimes. In the charities sphere such proscriptions arise from a number of sources, including general law, statute and governance standards articulated by the regulator. Unfortunately the wording of relevant conflicts duties varies extensively, giving rise to acute incoherence and uncertainty. This article undertakes detailed critical analysis of the myriad conflicts duties in order to provide certainty and comprehensive guidance. This resolution is relevant beyond the charitable sphere given the multitude of ways in which conflicts proscriptions are expressed in other governance contexts.
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ItemCassimatis v Australian Securities and Investments Commission [2020] FCAFC 52 - "Dystopian Accessorial Liability" or the End of "Stepping Stones" as We Know It?(Thomson Reuters, 2020)This note focuses on two significant point made by the majority judges in relation to s 180 of the Corporations Act 2001. The first is affirmation of the public nature of the duty of directors in s 180 of the Corporations Act 2001. The second is the point that stepping stones is not in fact a separate ground of liability. Rather, it is a straightforward application of s 180 (or another duty) to the fact of each particular case.