Strategic Builder Pty Ltd has five directors: Alana, Bob, Cooper, Derek and Erick. Derek and Erick are executive directors. They manage the day-to-day operations of Strategic Builder Pty Ltd. The company is engaged in all aspects of home building.

Cooper is an accountant and he helps out with the production of monthly financial reports for all the directors.

Alana has attended University and holds an engineering degree and a Masters of Business Administration (MBA). She has a good knowledge of the building industry and the way company finances work.

Bob is Ericks brother and has had a long history of depression and lack of self-esteem. Erick supported Bobs wish to become a board member even though he offered little by way of expertise. Erick thought that it would help Bobs personal development by giving him a different focus.

The company has experienced a severe decline in new contracts in the last two months. This is due in part to a number of cut-price builders offering cheap building contracts. This has placed the company in financial difficulties. Derek and Erick have been with the company since day one and are attached to the company. It is their main focus and provides them with emotional and financial wellbeing.

Bob has never read any financial statements that have been sent to him. He did not check the companys financial returns for any of the years before he was appointed and he has never read any reports since he was appointed.

Alanas brother Fabio has a building design company, Fabio the Designer Pty Ltd, and Alana attends its Board meetings and gives advice. Because of her education and experience the Board of Fabio the Designer Pty Ltd follows her directions. Recently, Strategic Builder Pty Ltd contracted with this company. It was Alana that convinced the rest of the Board of Strategic Builder Pty Ltd to enter this contract. It was Alana that had collected all the quotes for this work and they all exceeded the Fabio the Designer Pty Ltd quote. This was due to the fact that Fabio the Designer Pty Ltd had put in a quote below the cost price of the work because Alana had promised more work from Strategic Builder Pty Ltd in the future.

Cooper attended a Board meeting a few months ago and brought with him what he believed was a great idea. His proposal was that the company become involved in constructing cubby houses for children out of the leftover materials from around their building sites. The other Board members were not so convinced but Cooper being an accountant produced some very impressive figures based on information from the companys files. The board voted against the proposal after Alana, with her MBA training, argued the company should focus on its main game of house building.

Cooper is disappointed but yesterday signed a deal with another building company known as Domino Pty Ltd. The deal involves Cooper being paid a commission of 10% for every cubby house sold and a place on their Board.

Strategic Builder Pty Ltd is having financial problems yet the Board continues to allow the company to trade without considering the consequences.

Discuss the statutory and common law positions of the directors. What actions can be taken against the directors of the Strategic Builders Pty Ltd under the Corporations Act 2001 (Cth)?

Strategic Builder Pty Ltd has five directors: Alana, Bob, Cooper, Derek and Erick. Derek and Erick are executive directors. They manage the day-to-day operations of Strategic Builder Pty Ltd. The company is engaged in all aspects of home building.

Cooper is an accountant and he helps out with the production of monthly financial reports for all the directors.

Alana has attended University and holds an engineering degree and a Masters of Business Administration (MBA). She has a good knowledge of the building industry and the way company finances work.

Bob is Ericks brother and has had a long history of depression and lack of self-esteem. Erick supported Bobs wish to become a board member even though he offered little by way of expertise. Erick thought that it would help Bobs personal development by giving him a different focus.

The company has experienced a severe decline in new contracts in the last two months. This is due in part to a number of cut-price builders offering cheap building contracts. This has placed the company in financial difficulties. Derek and Erick have been with the company since day one and are attached to the company. It is their main focus and provides them with emotional and financial wellbeing.

Bob has never read any financial statements that have been sent to him. He did not check the companys financial returns for any of the years before he was appointed and he has never read any reports since he was appointed.

Alanas brother Fabio has a building design company, Fabio the Designer Pty Ltd, and Alana attends its Board meetings and gives advice. Because of her education and experience the Board of Fabio the Designer Pty Ltd follows her directions. Recently, Strategic Builder Pty Ltd contracted with this company. It was Alana that convinced the rest of the Board of Strategic Builder Pty Ltd to enter this contract. It was Alana that had collected all the quotes for this work and they all exceeded the Fabio the Designer Pty Ltd quote. This was due to the fact that Fabio the Designer Pty Ltd had put in a quote below the cost price of the work because Alana had promised more work from Strategic Builder Pty Ltd in the future.

Cooper attended a Board meeting a few months ago and brought with him what he believed was a great idea. His proposal was that the company become involved in constructing cubby houses for children out of the leftover materials from around their building sites. The other Board members were not so convinced but Cooper being an accountant produced some very impressive figures based on information from the companys files. The board voted against the proposal after Alana, with her MBA training, argued the company should focus on its main game of house building.

Cooper is disappointed but yesterday signed a deal with another building company known as Domino Pty Ltd. The deal involves Cooper being paid a commission of 10% for every cubby house sold and a place on their Board.

Strategic Builder Pty Ltd is having financial problems yet the Board continues to allow the company to trade without considering the consequences.

Discuss the statutory and common law positions of the directors. What actions can be taken against the directors of the Strategic Builders Pty Ltd under the Corporations Act 2001 (Cth)?

Strategic Builder Pty Ltd has five directors: Alana, Bob, Cooper, Derek and Erick. Derek and Erick are executive directors. They manage the day-to-day operations of Strategic Builder Pty Ltd. The company is engaged in all aspects of home building.

Cooper is an accountant and he helps out with the production of monthly financial reports for all the directors.

Alana has attended University and holds an engineering degree and a Masters of Business Administration (MBA). She has a good knowledge of the building industry and the way company finances work.

Bob is Ericks brother and has had a long history of depression and lack of self-esteem. Erick supported Bobs wish to become a board member even though he offered little by way of expertise. Erick thought that it would help Bobs personal development by giving him a different focus.

The company has experienced a severe decline in new contracts in the last two months. This is due in part to a number of cut-price builders offering cheap building contracts. This has placed the company in financial difficulties. Derek and Erick have been with the company since day one and are attached to the company. It is their main focus and provides them with emotional and financial wellbeing.

Bob has never read any financial statements that have been sent to him. He did not check the companys financial returns for any of the years before he was appointed and he has never read any reports since he was appointed.

Alanas brother Fabio has a building design company, Fabio the Designer Pty Ltd, and Alana attends its Board meetings and gives advice. Because of her education and experience the Board of Fabio the Designer Pty Ltd follows her directions. Recently, Strategic Builder Pty Ltd contracted with this company. It was Alana that convinced the rest of the Board of Strategic Builder Pty Ltd to enter this contract. It was Alana that had collected all the quotes for this work and they all exceeded the Fabio the Designer Pty Ltd quote. This was due to the fact that Fabio the Designer Pty Ltd had put in a quote below the cost price of the work because Alana had promised more work from Strategic Builder Pty Ltd in the future.

Cooper attended a Board meeting a few months ago and brought with him what he believed was a great idea. His proposal was that the company become involved in constructing cubby houses for children out of the leftover materials from around their building sites. The other Board members were not so convinced but Cooper being an accountant produced some very impressive figures based on information from the companys files. The board voted against the proposal after Alana, with her MBA training, argued the company should focus on its main game of house building.

Cooper is disappointed but yesterday signed a deal with another building company known as Domino Pty Ltd. The deal involves Cooper being paid a commission of 10% for every cubby house sold and a place on their Board.

Strategic Builder Pty Ltd is having financial problems yet the Board continues to allow the company to trade without considering the consequences.

Discuss the statutory and common law positions of the directors. What actions can be taken against the directors of the Strategic Builders Pty Ltd under the Corporations Act 2001 (Cth)?