Section 25

1.    Interpretation

In this Schedule –

business judgment means any decision to take or not take action in respect of a matter relevant to the business operations of a Relevant Corporation;

involved in respect of a contravention means, exclusively, where the person –

(a) has aided, abetted, counselled or procured the contravention; or

(b) has induced, whether by threats or promises or otherwise, the contravention; or

(c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the contravention; or

(d) has conspired with others to effect the contravention;

officer of a Relevant Corporation means –

(a) a director or secretary of a Relevant Corporation; or

(b) a person –

(i) who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the Relevant Corporation; or

(ii) who has the capacity to affect significantly the Relevant Corporation's financial standing; or

(iii) in accordance with whose instructions or wishes the directors of the Relevant Corporation are accustomed to act (excluding advice given by the person in the proper performance of functions attaching to the person's professional capacity or their business relationship with the directors or the Relevant Corporation); or

(c) a receiver, or receiver and manager, of the property of the Relevant Corporation; or

(d) an administrator of the Relevant Corporation; or

(e) an administrator of a deed of company arrangement executed by the Relevant Corporation; or

(f) a liquidator of the Relevant Corporation; or

(g) a trustee or other person administering a compromise or arrangement made between the Relevant Corporation and another person.

2.    Care and diligence – civil obligation only

(1) A director or other officer of a Relevant Corporation must exercise his or her powers and discharge his or her duties with the degree of care and diligence that a reasonable person would exercise if he or she –

(a) were a director or officer of a corporation in that Relevant Corporation's circumstances; and

(b) occupied the office held by, and had the same responsibilities within that Relevant Corporation as, the director or officer –

having regard to the provisions of this Act.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

(2) A director or other officer of a Relevant Corporation who makes a business judgment is taken to meet the requirements of subclause (1) , and his or her equivalent duties at common law and in equity, in respect of the judgment if the director or other officer –

(a) makes the judgment in good faith for a proper purpose; and

(b) does not have a material personal interest in the subject matter of the judgment; and

(c) informs himself or herself about the subject matter of the judgment to the extent he or she reasonably believes to be appropriate; and

(d) rationally believes that the judgment is in the best interests of a Relevant Corporation.

(3) The director's or officer's belief that the judgment is in the best interests of a Relevant Corporation is a rational one unless the belief is one that no reasonable person in his or her position would hold.

3.    Good faith – civil obligations

(1) A director or other officer of a Relevant Corporation must exercise his or her powers and discharge his or her duties –

(a) in good faith in the best interests of a Relevant Corporation; and

(b) for a proper purpose.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

(2) A person who is involved in a contravention of subclause (1) contravenes this subclause.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

4.    Use of position – civil obligations

(1) A director, secretary, other officer or employee of a Relevant Corporation must not improperly use his or her position to –

(a) gain, directly or indirectly, an advantage for himself or herself or someone else; or

(b) cause detriment to the Relevant Corporation.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

(2) A person who is involved in a contravention of subclause (1) contravenes this subclause.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

5.    Use of information – civil obligations

(1) A person who obtains information because he or she is, or has been, a director or other officer or employee of a Relevant Corporation must not improperly use the information to –

(a) gain, directly or indirectly, an advantage for himself or herself or someone else; or

(b) cause detriment to the Relevant Corporation.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

(2) A person who is involved in a contravention of subclause (1) contravenes this subclause.

Penalty:  Fine not exceeding 2 000 penalty units or imprisonment for a term not exceeding 5 years.

6.    Good faith, use of position and use of information – criminal offences

(1) A director or other officer of a Relevant Corporation commits an offence if he or she –

(a) is reckless; or

(b) is intentionally dishonest –

and fails to exercise his or her powers and discharge his or her duties –

(c) in good faith in the best interests of the Relevant Corporation; or

(d) for a proper purpose.

(2) A director, other officer or employee of a Relevant Corporation commits an offence if he or she uses his or her position dishonestly –

(a) with the intention of directly or indirectly gaining an advantage for himself or herself, or another person, or causing detriment to the Relevant Corporation; or

(b) recklessly as to whether the use may result in he or she or another person directly or indirectly gaining an advantage, or in causing detriment to the Relevant Corporation.

(3) A person who obtains information because he or she is, or has been, a director or other officer or employee of a Relevant Corporation commits an offence if he or she uses the information dishonestly –

(a) with the intention of directly or indirectly gaining an advantage for himself or herself, or another person, or causing detriment to the Relevant Corporation; or

(b) recklessly as to whether the use may result in he or she or another person directly or indirectly gaining an advantage, or in causing detriment to the Relevant Corporation.

7.    Directors and other Corporations

(1) A director of a Relevant Corporation is taken to act in good faith in the best interests of a Relevant Corporation if –

(a) the director acts in good faith in the best interests of any Relevant Corporation; and

(b) that other Relevant Corporation is not insolvent at the time the director acts and does not become insolvent because of the director's act.

(2) A director, secretary, other officer or employee of a Relevant Corporation is taken to have met the requirements in clauses 2 , 3 , 4 , 5 and 6 , and his or her equivalent duties at common law and in equity, even if –

(a) that person is a director, secretary, other officer or employee of another Relevant Corporation; or

(b) that person exercises powers or discharges duties as a director, secretary, other officer or employee of that Relevant Corporation in good faith in the best interest of another Relevant Corporation and for a proper purpose in connection with that other Relevant Corporation; or

(c) that person uses his or her position to gain, directly or indirectly, an advantage for another Relevant Corporation; or

(d) that person uses information obtained because that person is, or has been, a director or other officer or employee of a Relevant Corporation to gain, directly or indirectly, an advantage for another Relevant Corporation; or

(e) a conflict of interest exists because that person is a director, secretary, other officer or employee of another Relevant Corporation.

8.    Interaction of clauses 2 , 3 , 4 , 5 and 6 with other laws

(1) Clauses 2 , 3 , 4 , 5 and 6 have effect in addition to, and not in derogation of, any rule of law relating to the duty or liability of a person because of that person's office or employment in relation to a Relevant Corporation.

(2) Subclause (1) does not apply to –

(a) subclauses (2) and (3) of clause 2 to the extent to which those subclauses operate on the duties at common law and in equity that are equivalent to the requirements of clause 2(1) ; and

(b) clause 7 to the extent to which it operates on the duties at common law and in equity that are equivalent to the requirements of clauses 2 , 3 , 4 , 5 and 6 .