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In June 2023, members of Blackies Ltd. made a request to the directors to hold a meeting. Members intended to discuss about changing the constitution of the company and passing a resolution so that the company can issue more shares of the company and discuss whether it is a good idea to invest in the Stock Market. However, directors, Joseph, Kovin, and Blair did not want to follow the request. They argued that investment in the stock market is not a good idea at this stage. But members had been serious about it, and they wanted to hold the meeting at any cost for the best interest of the company.

Later, directors changed their mind. Accordingly, without holding the meeting of members, they organised a directors' board meeting. However, unfortunately after the company had invested money in the stock market, the company fell into financial trouble. Because of the financial trouble and sensing that the company will be wound up soon, directors have paid the outstanding price of the products purchased by their friends avoiding payment to other creditors. In August 2023, the company could not pay its first instalment of the loan taken from Premier Bank.

Facts revealed that the director, Joseph informed the bank before taking the loan that the loan amount would be used to invest in constructing a shopping complex in Joondalup area. Indeed, this was done to avoid delay in releasing money for the company.

Joseph argued that there is no wrong in this false statement since whatever he has done is for the sake of the company. He contends that he has no liability for the loan.

REQUIRED:

1. With reference to case laws and relevant sections of the Corporations Act 2001 (Cth), advise whether Blackies Ltd. directors and/or members will be liable for the loan taken from Premier Bank and for the payment to their friends. use citation for the following answer

youtousethe4-stepprocess,the4stepsare:

• Step1:Introducetheareaofthelaw
• Step2:Discusstheapplicable lawtosolveandquote relevantcasesandthe sectionsofthe

CorporationsAct2001(Cth)whereapplicable.

• Step3:Applythelawto thefactsto resolvetheproblem.
• Step4: Concluded