Company law

Corporate governance: lessons from the James Hardie decision
The decision of the New South Wales Supreme Court in Australian Securities and Investments Commission v Macdonald in April last year has generated substantial interest across the Tasman. The decision is also noteworthy here, particularly for the guidance it provides on the responsibilities of directors and senior executives, the conduct of board meetings and the release of market sensitive information. In this article, partner Glenn Joblin discusses the key aspects of ASIC's claims and the court's decision with commentary on the relevance of the decision under New Zealand's statutory regime. For a summary of corporate governance recommendations arising from the decision, see the corporate governance tips section at the end of the article.

Directors with inside information must buy and sell shares for 'fair value'
Insider trading is not usually associated with share dealings by directors of small private companies. However, a recent High Court case provides a useful reminder that section 149 of the Companies Act 1993 requires share transactions involving directors with material non-public information to be for ‘fair value'. If they are not, the director is liable to the seller (or buyer) for the difference between the 'fair value' and the price at which the shares were sold, regardless of whether the parties have reached a prior express agreement on the sale price.

Enquiries and information

For more information on any of the cases, articles and features in Commercial Quarterly, please email Diane Graham or call her on 64 9 916 8849.