Mentha v Colorbus Pty Ltd (in liq)

(2004) 213 ALR 789; [2004] VSC 486

Supreme Court of Victoria

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Interrogate

Catchwords

1. Corporations
2. › Directors
3. › Appointment of directors
4. › Proprietary company
5. › Requirement for director ordinarily resident in Australia
6. › Appointment of non-resident director as sole director
7. › Whether appointment invalid or nullity
8. › Corporations Act 2001 (Cth), s 201A(1)
1. Corporations
2. › Directors
3. › Validity of acts of directors
4. › Act done by invalidly appointed director
5. › Whether act rendered effective by s 201M(1)
6. › Appointment of administrators by invalidly appointed director
7. › Corporations Act 2001 (Cth), s 201M(1)
1. Corporations
2. › Voluntary administration
3. › Appointment of administrators
4. › Validity of appointment
5. › Appointment by director whose own appointment contravened s 201A(1)
6. › Whether appointment validated under s 1322(4)(a)
7. › Whether just and equitable to make order
8. › Corporations Act 2001 (Cth), ss 1322(4)(a), 1322(6)(a)(iii)

Quick Take

An act done by a director whose appointment contravenes s 201A(1) of the Corporations Act (requirement for a resident director of a proprietary company) is rendered effective by s 201M(1), because the invalidity arises from non-compliance with a provision of the Act. The appointment of such a director is invalid but not a nullity. Alternatively, such an appointment may be validated under s 1322(4)(a) where it is just and equitable to do so, even where the contravention is not merely procedural and there is no positive evidence that all persons concerned acted honestly.