Civil or criminal offences under the corporations act

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Reference no: EM132163488

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Clinton , Joseph and Elizabeth are the directors of BTN Pty Ltd , a mobile phone company . Joseph had known that the company was in financial difficulties in Dec 2009 but had assured his fellow directors it was just a temporary cash- flow issue and that the company could trade out of it difficulties and pay all of its directors by Feb 2010 . However , it was unable to do so . Joseph admits that the company’s difficulties began when the directors made a decision , after careful research an independent consultant’s report, to invest heavily in technology that was quickly rendered obsolete by the introduction if the “table” technology .

In March 2010, Elizabeth and Clinton became concerned about the increasing number of “final demand” notices from suppliers and asked to see the actual account rather than continuing to rely on the assurances of Joseph . It was only then Elizabeth and Clinton realised that the company was insolvent and the immediately filed an application to wind-up the company . It went into liquidation in April 2010, owing large sun of money to its creditors .

In early 2009, before the liquidity problems emerged . Elizabeth was appointed as an non-executive director of Otus Ltd . In fulfilling her duties as a director , she acquired information about the tender process that Otus was engaged in for the provision of mobile phone services on regional Australia . Without disclosure to BTN or Otus , she used this information to benefit BTN Pty Ltd , Which submitted a successful tender

a) Advise Elizabeth , Clinton and Joseph whether any of them may have committed any civil or criminal offences under the Corporations Act 2001.

b) Advise Elizabeth , Clinton and Joseph of their liability under the Corporations Act 2001 for the debts of the company.

Reference no: EM132163488

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