Question
Peter and Lucy are executive directors of Green Thumbs Pty Ltd, a successful retail nursery business. Peter is the majority shareholder with 75% of the
Peter and Lucy are executive directors of Green Thumbs Pty Ltd, a successful retail nursery business. Peter is the majority shareholder with 75% of the total shares and the company's managing director, Peter's wife, Jane,holds 20% of the shares and a director of the company. and Lucy holds the remaining 5% of the shares and also a director of the company.Lucy,from the start, is actively involved in the business and has been instrumental in bringing new and creative ideas to the business.Lucy has started serving refreshments in the nursery shop. Peter always resisted the idea of serving refreshments because he does not see it as part of the business plan. Peter is also unhappy that serving refreshments diverted resources away from the nursery. Lucy, however, is adamant that it has enhanced the business by drawing more customers to the shop and argues that the income from the refreshments would serve as a lucrative secondary stream of revenue to the business. Their differences in opinion have gradually become more strained and have led to increased diffcultv in the management of the dav to day business.Peter is thinking about using his majority position as a shareholder to remove Lucy from the board of directous.He is, however, hesitant about proceeding with the decision to expel her from the board of directors. Peter now seeks your advice as to whether Lucy,as a minority shareholder has any legal recourse against the company. Your answers must include case law (where relevant) and the provisions of the Corporations Act 2001.
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