Question
Paul is a director of Shine Bright Pty Ltd, a company that offers vocational education courses to people living in regional areas. He worries that
Paul is a director of Shine Bright Pty Ltd, a company that offers vocational education courses to people living in regional areas.
He worries that the company shareholders are unhappy with his performance as a director. He issues 50 company shares to his sister Veronica so that she can vote against any proposal to remove him as a director. Paul also believes the share issue is justified because Shine Bright also needs to raise capital to open a centre in a new regional area.
Willow, a shareholder of Shine Bright Pty Ltd, thinks the share issue may be improper but is unsure because she is also aware that Shine Bright Pty Ltd needs to raise capital.
Advise Willow if Paul has breached his directors' duties to exercise his powers for a proper purpose. Use the IRAC method to structure your answer.
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