Total abdication of directorial responsibilities cannot constitute 'good reason' for non-participation in management under s 588FGB(5) or s 588H(4) of the Corporations Act 2001 (Cth). The defence is directed to non-participation at a particular point in time and presupposes general participation in management. A spouse director who accepts appointment as a formality and takes no part in management cannot rely on the defence, notwithstanding the abolition of the requirement for a minimum of two directors. The 'good reason' defence must be read down in accordance with the scope and purpose of the Corporations Act, and principles from other areas of law (such as unconscionability, undue influence, or Garcia v NAB) do not define the scope of 'good reason' in this context.
The full text is available to signed-in members, including the 92 later cases that cite this judgment.
12 of the 92 citing cases carry a classified treatment. How each court treated it is available to signed-in members.