QUESTION THREE John was the Managing Director of Green Gardens Pty Ltd (\"Green Gardens'), a company which exported and imported garden plants, landscaping features and outdoor furniture. His wife Ling was a director (she worked in the gardens). His two children Esther and Renee managed the nances and administration and worked part time as senior officers. All four family members were equal shareholders in the business. Esther was a University student and sometimes needed to borrow money. As she managed the nances, she did not worry about asking to borrow money, as she always paid it back. At the moment, she is struggling to repay $1000. Renee is the older sister who has just purchased her own home. She works at Quick Finance as a loans manager and receives a much higher rate of pay than her weekend shifts at Green Gardens. She often takes home plants, gardens or statues each week as a way to reflect her value. This works well for her she estimates her property has benefitted from $5,000 worth of Green Gardens products in the last year. Unfortunately, business had been steadily declining for six months, and Green Gardens was having trouble paying its creditors. John had been worried about this for some time, but it was hard to invite Ling to a directors meeting she thought it was silly to have a fake meeting with her husband. She wasn't interested in paperwork or processes she just wanted to cultivate. On 10th January 2019 it informed several unsecured creditors that debts would be paid late. The following transactions transpired: - Green Gardens paid $5,000 to a creditor, Plantlife, after they threatened to bring winding-up proceedings against Green Gardens. - When Plantlife told another creditor, Designs, of the payment then Designs also threatened winding-up proceedings. They were owed $9,000 . To settle the outstanding sum of $9,000, Darren the director of Designs agreed to have a Green Gardens company van transferred to him. John thought this was a good deal even though the van was worth $1 1,000. Trying to ward of insolvency and keep the company aoat, John arranged for a $35,000 loan on behalf of Green Gardens from Quick Finance in early February 2019. Green Gardens was to repay the loan on demand. Interest on the loan was set at 10 per cent per month. Around this time, Renee announced her engagement and she asked her father if any dividends would be issued. Not wanting to worry her, he instead gave her $5,000 so she could put a deposit on a venue. She thanked him very much! In August June 2019, Green Gardens was wound-up on the application of an unsecured creditor, Statues Ltd. Green Gardens had been unable to satisfy a statutory demand issued by Statues Ltd which had been served on Green Gardens' registered ofce on 1 June 2019. Louise the liquidator was appointed in mid-August 2019. REQUIRED Respond to the following scenario based problem and answer all questions. Refer to relevant cases and statutory law in your answers where appropriate. a) Advise Louise the liquidator whether she can take any proceedings against Plantlife andl'or Designs andfor Quick Finance or the transactions entered into with regard to those companies? (10 marks} b) Explain the requirements that Statues Ltd had to meet so that the Court would issue a winding up order for Green Gardens. Are there any defences that Green Gardens can take against this action? (7.5 marks) a) Explain whether any directors have breached their duties, and whether any valid defences apply. Include reference to any applicable penalties. Support your answer with reference to statutory and case law. (7.5 marks) Total = 25 marks