USYD CLAW6002 Corporate Law Homework Question

Alex is a member of Acme Ltd, a public company listed on the ASX. Acme Ltds constitution provides

that each ordinary shareholder is to be given a copy of all proposed resolutions (both ordinary and

special) at an upcoming members meeting in the notice of meeting. Alex and many other

shareholders have been dissatisfied with Acme Ltds management for some time due to the

companys consistently poor performance and declining share price. Alex decides to actively

campaign against the current board of directors, by contacting all of the companys members and

asking them to direct their proxies to him at the next AGM so that he can vote out the current

chairman of the board who appointed the companys senior management team. Alex hopes that this

will send a message to the remaining board and the senior management team that they need to

improve their performance.

(a) How could Alex contact all of the members of Acme Ltd? How might Acme Ltd be able to prevent

Alex from contacting all of the companys members?

Assume that Alex was unsuccessful in his attempt to obtain sufficient proxy votes to vote out the

current chairman. However, Alexs campaign has raised greater awareness within the companys

membership about the failings of the current chairman and a large number of proxies are assigned

to the chairman to vote against a motion to increase the directors remuneration at the next AGM.

Acme Ltds chairman is also the chair of the AGM and inadvertently misplaces the proxy votes

voting against the directors remuneration increase.

(b) What possible consequences may result from the failure to properly vote the proxies?