- hold a directors’ meeting to approve the terms of the explanatory memorandum and to convene a members meeting (annual or otherwise); - forward the explanatory memorandum to the members together with notice of an annual or extraordinary general meeting; - ask the members to consider and if thought fit, approve the terms of the deed and the company entering into the deed with each of the current (and possibly future) directors of the company (or, if such documents have already been entered into, to ratify the entering into of the documents by the company); - ensure that the resolution expressly provides that the operative date of the relevant deeds (once executed or ratified) be the date of appointment of the director. There is a significant possibility that if the above procedures are not adopted, the deeds may be void because, where all directors wish to enter a separate deed at the same time, the better view is that only the shareholders in general meeting are competent to decide whether the company should enter such documents. Corrs Chambers Westgarth recommends that it is better for directors to seek the approval of the members in the first instance rather than to find out once the legal bill for litigation arrives, that the document (including the indemnity) was void. (C) CIVIL LITIGATION FUNDING (Submitted by Gregory Burton, Barrister, Sydney) (i) The Problem Most of the population neither qualifies for legal aid in respect of pursuing civil claims nor is sufficiently wealthy to undertake such claims despite their merits. Liquidators and administrators, and trustees in bankruptcy, can be frustrated from pursuing appropriate civil compensation and recovery measures by an absence of resources. The creditors may be unwilling or unable to provide funds to indemnify. The incentive of preference in ultimate distribution is subject to creditor or court approval where more than $20,000.00 is involved: Corporations Law sections 477(1)(b), 564. The courts are not particularly liberal on rewarding indemnifying creditors: see, for example, the discussion by Powers in (1997) 8 Journal of Banking and Finance Law and Practice. Although litigation insurance exists on a fixed premium basis for defence of claims (such as directors' and officers' insurance), it may become more affordable if premiums were lower because, for instance, the insurer could recover a proportion of any cross-claim proceeds or of the subject matter of the litigation being defended. (ii) The opportunity
- hold a directors’ meeting to approve the terms of the explanatory memorandum and to convene a members meeting (annual or otherwise); - forward the explanatory memorandum to the members together with notice of an annual or extraordinary general meeting; - ask the members to consider and if thought fit, approve the terms of the deed and the company entering into the deed with each of the current (and possibly future) directors of the company (or, if such documents have already been entered into, to ratify the entering into of the documents by the company); - ensure that the resolution expressly provides that the operative date of the relevant deeds (once executed or ratified) be the date of appointment of the director. There is a significant possibility that if the above procedures are not adopted, the deeds may be void because, where all directors wish to enter a separate deed at the same time, the better view is that only the shareholders in general meeting are competent to decide whether the company should enter such documents. Corrs Chambers Westgarth recommends that it is better for directors to seek the approval of the members in the first instance rather than to find out once the legal bill for litigation arrives, that the document (including the indemnity) was void. (C) CIVIL LITIGATION FUNDING (Submitted by Gregory Burton, Barrister, Sydney) (i) The Problem Most of the population neither qualifies for legal aid in respect of pursuing civil claims nor is sufficiently wealthy to undertake such claims despite their merits. Liquidators and administrators, and trustees in bankruptcy, can be frustrated from pursuing appropriate civil compensation and recovery measures by an absence of resources. The creditors may be unwilling or unable to provide funds to indemnify. The incentive of preference in ultimate distribution is subject to creditor or court approval where more than $20,000.00 is involved: Corporations Law sections 477(1)(b), 564. The courts are not particularly liberal on rewarding indemnifying creditors: see, for example, the discussion by Powers in (1997) 8 Journal of Banking and Finance Law and Practice. Although litigation insurance exists on a fixed premium basis for defence of claims (such as directors' and officers' insurance), it may become more affordable if premiums were lower because, for instance, the insurer could recover a proportion of any cross-claim proceeds or of the subject matter of the litigation being defended. (ii) The opportunity