Julie has been a shareholder in Indahouse Pty Ltd for some years and is upset to receive a letter from the company instructing her to transfer all of her 200 shares to Bob Marley. She also learns that the company's constitution contains a rule that provides "the chairperson of the company may, as they see fit, order any member to transfer their shares to any person at a fair market price".

Jimmy, another shareholder, discovers that as the company requires more funds the directors plan to issue a parcel of shares to a single investor without the members being able to participate.

Julie does not wish to sell her shares.Is she bound to observe the order she has received?

Are the directors correct in issuing the shares, as they plan?