Reference no: EM132532978

Premier Commercial Investments Pty Ltd ('PCI') is a investment company based in Parramatta that focuses on buying and developing commercial property sites and then onselling them. It decides to expand into the retail property market with a focus on buying and then leasing retail properties. For this, PCI creates a wholly-owned subsidiary company called Premier Retail Leasing Pty Ltd ('PRL') to develop this side of the business. PCI's three directors appoint themselves as PCL's three directors. This is convenient because it means they can discuss matters for both companies at the same time when they have their board meeting each month. They make sure, however, that afterwards they write up separate board meeting minutes for the two companies. Over the next three years, they operate the retail leasing business by borrowing heavily from Westbank Ltd to buy properties and then make loan repayments from the money they receive in rent.

After three years, the business has become successful to the point where, PCI arranges an interest-free loan from PRL, when PCI's cash-flow becomes tight. However, in January 2020, the coronavirus causes retail property prices to plummet and PRL defaults on its loan repayments to Westbank. PRL now does not have enough assets to pay back all the money it owes Westbank.

Advise Westbank as to what legal rights it may have under the provision of company law corporations act.