Eastland Technology Australia Pty Ltd & Ors v Whisson & Ors

(2005) 223 ALR 123; [2005] WASCA 144

Western Australia Court of Appeal

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Interrogate

Catchwords

1. Corporations
2. › Directors' duties
3. › Indemnification and exemption from liability
4. › Release in deed of settlement compromising disputed claim
5. › Whether void under s 241 of the Corporations Law
6. › Whether s 241 applies to release forming part of bona fide compromise
7. › Corporations Law 1990 (Cth), s 241
1. Corporations
2. › Directors' duties
3. › Fiduciary duties
4. › Corporate opportunities
5. › Whether director obliged to offer company opportunity to be co-inventor
6. › Whether inventive activity outside scope of directorial duty
7. › Whether director in competition with company
1. Corporations
2. › Directors' duties
3. › Statutory duties
4. › Duty to act honestly
5. › Improper use of position
6. › Whether breach of s 232(2), (5) and (6) of the Corporations Law independent of general law claims
7. › Corporations Law 1990 (Cth), s 232
1. Practice and Procedure
2. › Conduct of trial
3. › Concessions by counsel
4. › Nature and effect of concession
5. › Whether counsel conceded only defence to counterclaim was arbitration point
6. › Whether appellants bound by concession on appeal

Quick Take

Section 241 of the Corporations Law (and by analogy s 199A of the Corporations Act 2001) does not prohibit a release that forms part of the consideration for a bona fide compromise of a disputed claim against a director, because the substance of such a transaction is a release from a disputed claim rather than an exemption from liability. A director who is not contractually obliged to undertake research and development for the company is free to invent and patent during the period of directorship, even where the invention relates to the company's business, provided the director does not commercialise the invention without the company's involvement while remaining a director. The question whether s 241 applies only to blanket exemptions was left open.