Corporations Act. Australia
for actions of delegate
(1) If the directors delegate a power under section 198D, a director is responsible for the exercise of the power by the delegate as if the power had been exercised by the directors themselves.
(2) A director is not responsible under subsection (1) if:
(a) the director believed on reasonable grounds at all times that the delegate would exercise the power in conformity with the duties imposed on directors of the company by this Act and the company’s constitution (if any); and
(b) the director believed:
(i) on reasonable grounds; and
(ii) in good faith; and
(iii) after making proper inquiry if the circumstances indicated the need for inquiry;
that the delegate was reliable and competent in relation to the power delegated.
190A Limited application of Division to registrable Australian bodies
This Division does not apply to an act or omission by a director or other officer or employee of a corporation that is a registrable Australian body unless the act or omission occurred in connection with:
(a) the body carrying on business outside its place of origin; or
(b) an act that the body does or proposed to do outside its place of origin; or
(c) a decision by the body whether or not to do or refrain from doing outside its place of origin.
190B Division does not apply to Aboriginal and Torres Strait Islander corporations
This Division does not apply to a corporation that is an Aboriginal and Torres Strait Islander corporation.
Note: Division 265 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006 deals with the general duties of directors, secretaries, officers and employees of Aboriginal and Torres Strait Islander corporations.
Division 2 — Disclosure of, and voting on matters involving, material personal interests
191 Material personal interest — director’s duty to disclose
Director’s duty to notify other directors of material personal interest when conflict arises
(1) A director of a company who has a material personal interest in a matter that relates to the affairs of the company must give the other directors notice of the interest unless subsection (2) says otherwise.
(1A) For an offence based on subsection (1), strict liability applies to the circumstance, that the director of a company has a material personal interest in a matter that relates to the affairs of the company.
Note: For strict liability, see section 6.1 of the Criminal Code.
(2) The director does not need to give notice of an interest under subsection (1) if:
(a) the interest:
(i) arises because the director is a member of the company and is held in common with the other members of the company; or
(ii) arises in relation to the director’s remuneration as a director of the company; or
(iii) relates to a contract the company is proposing to enter into that is subject to approval by the members and will not impose any obligation on the company if it is not approved by the members; or
(iv) arises merely because the director is a guarantor or has given an indemnity or security for all or part of a loan (or proposed loan) to the company; or
(v) arises merely because the director has a right of subrogation in relation to a guarantee or indemnity referred to in subparagraph (iv); or
(vi) relates to a contract that insures, or would insure, the director against liabilities the director incurs as an officer of the company (but only if the contract does not make the company or a related body corporate the insurer); or
(vii) relates to any payment by the company or a related body corporate in respect of an indemnity permitted under section 199A or any contract relating to such an indemnity; or
(viii) is in a contract, or proposed contract, with, or for the benefit of, or on behalf of, a related body corporate and arises merely because the director is a director of the related body corporate; or
(b) the company is a proprietary company and the other directors are aware of the nature and extent of the interest and its relation to the affairs of the company; or
(c) all the following conditions are satisfied:
(i) the director has already given notice of the nature and extent of the interest and its relation to the affairs of the company under subsection (1);
(ii) if a person who was not a director of the company at the time when the notice under subsection (1) was given is appointed as a director of the company — the notice is given to that person;
(iii) the nature or extent of the interest has not materially increased above that disclosed in the notice; or
(d) the director has given a standing notice of the nature and extent of the interest under section 192 and the notice is still effective in relation to the interest.
Note: Subparagraph (c)(ii) — the notice may be given to the person referred to in this subparagraph by someone other than the director to whose interests it relates (for example, by the secretary).
(3) The notice required by subsection (1) must:
(a) give details of:
(i) the nature and extent of the interest; and
(ii) the relation of the interest to the affairs of the company; and
(b) be given at a directors’ meeting as soon as practicable after the director becomes aware of their interest in the matter.
The details must be recorded in the minutes of the meeting.
Effect of contravention by director
(4) A contravention of this section by a director does not affect the validity of any act, transaction, agreement, instrument, resolution or other thing.
Section does not apply to single director proprietary company
(5) This section does not apply to a proprietary company that has only 1 director.
192 Director may give other directors standing notice about an interest
Power to give notice
(1) A director of a company who has an interest in a matter may give the other directors standing notice of the nature and extent of the interest in the matter in accordance with subsection (2). The notice may be given at any time and whether or not the matter relates to the affairs of the company at the time the notice is given.
Note: The standing notice may be given to the other directors before the interest becomes a material personal interest.
(2) The notice under subsection (1) must:
(a) give details of the nature and extent of the interest; and
(b) be given:
(i) at a directors’ meeting (either orally or in writing); or
(ii) to the other directors individually in writing.
The standing notice is given under subparagraph (b)(ii) when it has been given to every director.
Standing notice must be tabled at meeting if given to directors individually
(3) If the standing notice is given to the other directors individually in writing, it must be tabled at the next directors’ meeting after it is given.
Nature and extent of interest must