Mountain Pty Ltd has issued 10,000 shares to its four members. Minnie and Tiny hold 10% of the shares each, Maddie holds 20%, and Max holds 60% of the shares. Max is Mountain Pty Ltds only director. He has recently diverted one of Mountain Pty Ltds regular supply contracts to Mighty & Strong Pty Ltd, a company on whose board he also sits. He has offered Maddie 500 shares in Mighty & Strong Pty Ltd if she were to vote in favour of a resolution (at Mountain Pty Ltds general meeting) to insert a clause into Mountain Pty Ltds constitution that its directors can divert business opportunities as they see fit and can retain any profits made from business diversions. Minnie and Tiny are upset and seek your advice.

REQUIRED:

Discuss remedies that may be available to Minnie and Tiny under the Corporations Act 2001 (Cth). Please omit (ignore) the winding up remedy, as Minnie and Tiny do not wish for the company to be wound up.

Steps 1 and 2: 6 Marks.

Steps 3 and 4: 6 Marks