Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Business Law & Ethics Expert

Misfeasance:

Under s.324, misfeasance proceedings may be instituted against a director, promoter, manager, liquidator or "officer" (including an auditor) of a company in liquidation either to recover the company's property from him or to claim compensation for the loss to the company caused by his misfeasance.

The most obvious case of misfeasance is where a director or other officer of the company is found to have misappropriated property of the company.  He can be compelled by misfeasance proceedings to return it.  His conduct may also be criminal misappropriation of property for which he can be prosecuted.

The other type of misfeasance case is where the company has suffered loss owing to the incompetence or neglect of a director or other officer.  It is not however easy to establish that there has been breach of a fiduciary duty such that an order should be made (on grounds of misfeasance) for payment of compensation.  For some lesser default the liquidator could bring an action for negligence.

In the context of misfeasance proceedings an auditor is exceptionally an "officer" who can be liable: he is not an "officer" in any other situation since he has no management functions.

A receiver is not an "officer" who can be held liable (if the company later goes into liquidation) for misfeasance.

                                      Case. RE B JOHNSON & JOHNSON CO (BUILDERS) (1955)

Misfeasance proceeds were brought against a receiver on the ground that he had in his management of the company's business taken decisions which were "detrimental from the company's point of view", eg. closing down parts of its business. 

Held:

A receiver is a representative of the secured creditors by or for whom he is appointed.  He is not an officer of the company who can be liable for misfeasance. If however a receiver does not act bona fide (ie. honestly) the company might have a claim against him but not misfeasance.

Business Law & Ethics, Finance

  • Category:- Business Law & Ethics
  • Reference No.:- M9518004

Have any Question?


Related Questions in Business Law & Ethics

Compare and contrast tort law and criminal law explain the

Compare and contrast tort law and criminal law. Explain the purpose of the law of torts in contract to the purposes of criminal law. Why are they different? Support your answer using specific examples from the textbook.

Property law for business assignment question -mrs betty

PROPERTY LAW FOR BUSINESS ASSIGNMENT QUESTION - Mrs Betty Joyce lives in an old, war-time vintage army shed in Baldivis. When she started to live in the shed, in the early 1960s, the whole area was a remote backwater. Si ...

Corporations law - assignment questions -objectives -

CORPORATIONS LAW - ASSIGNMENT QUESTIONS - Objectives - Answer the following questions with reference to the relevant statute law and general common law principles operating in Australia concerning the consequences of the ...

Instructionplease choose one question from the following to

Instruction Please choose One question from the following to answer: 1. Dealsgate is a Victorian town in Southern-East England, famous for its beautiful beach. It used to attract many world-renowned writers and scholars ...

Assignment - advanced financial accounting1 classification

Assignment - Advanced Financial Accounting 1. 'Classification of liabilities is based on the same principles as the classification of assets.' Do you agree with this? Why or why not? 2. 'Classification of liabilities as ...

Group report1 this group assignment consists of 2 parts

GROUP REPORT 1. This group assignment consists of 2 parts. Part A is a case study on contract law, and Part B is a question involving Corporations Law. Both questions must be answered. 2. The total word limit for the gro ...

Exerciseform yourselves into groups and consider the

Exercise Form yourselves into groups and consider the question: What is research? Write a list of 5 characteristics of research. What are the characteristics of research at postgraduate level? Scholarship: "The analysis ...

The good cop click on the tab and read the journal essay

The Good Cop." Click on the tab and read the journal essay. Pay particular attention to II The Third Way: Rightful Policing. In the essay, the author makes the case for, what she terms, "rightful policing." What is right ...

Business law assignment question -mabo has been said to a

BUSINESS LAW ASSIGNMENT QUESTION - Mabo has been said to a cornerstone of the Australian legal system. Your response must discuss the following: 1. Discussion of the Mabo (No 2) case. 2. Explain the impacts of the case o ...

Australian commercial and corporations law assignment -this

Australian Commercial and Corporations Law Assignment - This assignment deals with critical problem solving skills. This assessment tests course objectives addressing: Knowledge of relevant law, Application of the law to ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As