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Solution Library
Legal Advices to XYZ Pty Ltd Regarding Executive Directors Breach of Duties
Question
Tina Stone is the editor of and an executive director of XYZ Pty Ltd (XYZ) which publishes a free lifestyle magazine widely distributed in Melbourne. The magazine relies heavily on its advertising revenue. Tina became dissatisfied with her position in the company and decided to leave and set up her own competing publication. Before she resigned she sent letters to many of the businesses advertising in the magazine, inviting them to transfer their business to her new publication. She compiled the list of persons to whom she wrote from memory and publicly available sources of information such as the White Pages and other directories, not from XYZ's records.
Three days after posting these letters Tina resigned from XYZ. Her new magazine was published the following week and many of the businesses she had contacted transferred their advertising to it.
Required:
Advise XYZ:
a) whether Tina has breached her fiduciary duties or any provisions of the Corporations Act; and
b) if Tina has breached any general law or statutory duties, what remedies might be available to XYZ?
Summary
This question belongs to business and corporate law and discusses about advice to a company regarding executive director’s breach of her fiduciary duties.
Total word count: 402
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