澳大利亚公司法：董事和股东会议规则

澳大利亚公司法：董事、股东会议规则1.Sweet Treats, Inc. is a “closely held” or “closer” corporationCorporations are often classified with various features. One of them is whether the corporation issues shares to the public. Its shares are not publicly sold and bought and ne eds no registration. As stated in the case, Sweet Treats, Inc. (“STI”) is a corporation which is solely owned by four shareholders: Andy, Brittney, Carol and Dell. Each owns 25% of STI. STI has not issued any shares to the public now. The four shareholders are also members of the board of directors. This kind of corporation is also called “private company”.2.As a director of the corporation, Andy causes inconvenience to the board of directors, and may damage the interests of the shareholdersAs stated in the case, Andy had become harder to work with. Over the last year, he wears bright red clothing every day from head to toe; he sang in communications; he brought lunch that smell terrible to work. All of above behaviors may affect the normal running of the company. His inappropriate wearing may affect the image of the company since he possesses the position of director. When communicating he chose to present him through song lyrics, he sang in all communications. The behavior may gives bad impacts upon the effect of communications, the effect and efficiency of his work and may affect the good impression of the company. As for brings lunch to work which has bad smelt, it may obstructs his colleagues from working efficiently. The relationship between him and his colleagues thus is very bad.3.As Andy, Brittney, Carol and Dell are solely shareholders and directors of the corporation, they may agree on how and who they will elect to the board of directors of the corporation3.1Shareholders may agree to elect each other as directorsShareholders are the owner of a corporation in fact. As a general rule, shareholders may agree on how they will. Certainly, shareholders may also reach an agreement to elect each other to the board of directors since an ownership grants them supreme and absolute power and rights over their corporation. But when they are appointed to the board, as directors owes a fiduciary duty to the company and shall use their position and exercise their rights for the best benefits of the company.The above analysis demonstrates that Andy, Brittney, Carol and Dell have rights to agree on the election of any of them to the board of directors. Brittney, Carol and Dell may agree to elect each other as directors. Since the three directors wanted to remove Andy from the position of a director, they may remove him through reaching an agreement which does not elect Andy to the board of directors. Generally, Brittney, Carol and Dell should not use the position of directors to reach such agreement inconsistent with obligations owed to the company as directors. But as analyzed above, the behaviors of Andy had breached his obligations as a director and harmed the interests of the other shareholders and the company. Brittney, Carol and Dell may also use their positions as directors to reach the agreement because this is not inconsistent with their fiduciary duties owed to the corporation.3.2The rule of “shareholder unanimity exception”A corporation is actually owned by its shareholders. An owner is granted a full scope of ri ghts and interests to his things. The rule of “shareholder unanimity exception” represents that if a decision has been agreed by all shareholders of a corporation, the efficacy of the decision will be supreme. The rule exists provided that a decision of the board of directors does not comply with the interests of the shareholders.It is the best state if Andy also agrees to elect Brittney, Carol and Dell to the board of directors and agrees not to elect himself as a director. In case the aforesaid circumsta nce happens, the rule of “shareholder unanimity exception” will apply and Andy will be smoothly removed from the board without any legal risks. But it seems an unhappy arrangement and it is unreasonable to expect Andy to agree to such arrangement. But even though Andy is not a party to the agreement which does not nominate him as a director the agreement may be still enforceable, provided that: (1) the corporation is a closer held corporation. As analyzed in part 1, Sweet Treats, Inc. is a “closely held” or“closer” corporation. (2) Other shareholders do not object the agreement; (3) terms of the agreement are reasonable. So if Andy objects the agreement then it will be unenforceable. Actually Andy may be very likely to object the agreement. Agreement between the three shareholders, Brittney, Carol and Dell, to remove Andy from the board of directors is not so exercisable.3.3Removal of Andy is for the best benefits of all shareholders and the corporation As mentioned in part 2, Andy may cause damages to the shareholders and the corporation. As stated in the case, any replacement for Andy may probably require a salary of 75000 dollars a year, which is 25000 dollars less than before. What STI shareholders Agreement provides protect the shareholder who is fired by the corporation. In order to minimize potential liabilities, the board may choose to fire Andy and at same time nominate him other position.Finally, I would suggest Brittney, Carol and Dell the following course of action which may minimize their potential liability: (1) Notify all shareholders of the corporation to hold a meeting of the shareholders; (2) reach an agreement which elect Brittney, Carol and Dell as the directors of the corporation; (3) while remove Andy from the board of directors nominate Andy a other position to avoid repurchase of his shares by the company(the Shareholders Agreement only provides shares of shareholders who ceases to be employed by STI should be repurchased).。