Bryan's 232, S461 (A) And S 232

Introduction

Many companies are controlled by single or a group of shareholders. This is particularly common in proprietary companies. In a majority-controlled company, minority shareholders face significant problem If the controllers run the company in their own interest or act unfairly discriminatory, unfairly prejudicial or oppressively. The Corporation Act provides effective procedures to enable members to obtain remedies in circumstances where the controllers of a company act oppressively or unfairly towards them.

In our case, Bryan is minority-shareholder; Don and his board faction are majority-shareholder. To protect Bryan’s interests and rights, there are two possible remedies can be advised to Bryan: s 232, s461 (1) (e), (f) and (g). S 232 provides a remedy where the affairs of a company are conducted in a manner that is contrary to the interests of the member as a whole, oppressive, unfairly discriminatory or unfairly prejudicial.1 The court may order the winding up of a company under s
In our case, Don use his director’s power given by company constitution to nominate a majority of the board. This helps Don easier to control the company and gain voting power in the director’s meeting. Don can make his decision as the company’s decision in order to dominance of board proceedings. And Don rewarded MYCO Company (which Don own 20 percent share) a three-year contract to supply COCO, without discuss the transaction with the board. Don has breached the fiduciary duty that is to avoid conflict interest, and also didn 't disclose the transaction to the board. So Don’s conduct of breaching director’s duty is contrary to the interest of the members as a