* Duty of care and dillgence – statute law – s180 * S588G imposes a duty upon directors to prevent their company trading whle it is insolvent . s588G requires directors to be continually monitoring the financial status of their coy (* only apply to directors) * S181 – duties to act in good faith in the interest of coy and for a proper purpose * S 191 – duties to avoid conflicts of interest * S182&S183 – not to make improper use of position or information (* apply to employee) * S9 – define officer of coy- have management responsibility relation to a coy in financial difficulties * Generally the duty will be owed to the members as a collective whole (not a minority) that should be considered by directors: * Generally there will be no duty owed to individual shareholders; The director needs to have been in direct and close contact with the individual member so that the director caused the member to act in a certain way which turned out to be detrimental to them: Here, the facts are similar to Brunninghausen v Glavanics, where a fiduciary arose to the individual. In that case there were only 2 shareholders (both were directors also), and B convinced G to sell their shares and resign as director so that B could act on an offer of sale (unknown to G). An individual fiduciary duty was found because G was the company, aside from B, and G relied on B for information about the company. Our situation is similar in that [reasons] and therefore [director] may owe [individual] a fiduciary duty. *

* Statutory law –enforced by ASIC—civil penalty provision pp 210 --- criminal penalty ( * not apply to s180)

General Law – enforced by coy – compensation / damage to be paid to the coy * Reasonable care
Daniels v AWA – minmum standard of care , skill and diligence expected of all directors