Business Management - Managing the Legal Environment - Assingment, Exercises of Law

Download Business Management - Managing the Legal Environment - Assingment and more Exercises Law in PDF only on Docsity! MANAGING THE LEGAL ENVIRONMENT Business management and managing legal risks. Objectives: Understand the legal risk environment in which business managers must operate, particularly in relation to consumer protection and company law. Understand the tension between the public interest and legal regulation, and the capacity for regulation to pose legal risk that undermine economic growth. Understand the competing pressures put on business managers by law and politics, and responses to this. Students demonstrate an understanding in writing of the operation of specific legal rules and the competing values behind those rules. Outline: 1. Video ‘The Corporation’ Can company leaders such as directors voluntarily be participants in the development of society rather than just profit maximisers? How will shareholders view their company’s attempts to be seen as having “corporate social responsibility?” ACTIVITY 1: Conflicting of duties: social responsibility and the duty of directors to act in the best interests of shareholders as a whole. Use law to answer question: 181 Corporations Act (Cth) 2001 (1) A director or other officer of a corporation must exercise their powers and discharge their duties: (a) in good faith in the best interests of the corporation; and Bowen LJ in Hutton v West Cork Railway Co (1883) 23 Ch D 654 They [directors] can only spend money which is the company's if they are spending it for the purposes which are reasonably incidental to the carrying on of the business of the company. ... The law does not say that there are to be no cakes and ale, but there are to be no cakes and ale except such as are required for the benefit of the company. ... It is not charity sitting at the board of directors. Case: A company manufacturing cars in Australia closes one of its plants and has to lay-off 500 workers. The directors decide to give each worker a $50,000.00 payment (in addition to the wages and payments the workers are legally entitled to) to show thanks. Question: Have the directors breached section 181? See Parke v Daily News Ltd [1962] Ch 927 Docsity.com 2. Consumer Protection powerpoint presentation Caveat emptor means ‘let the buyer beware’. It means buyers have a responsibility to look out for their own interests. What might be some of the problems for business, society and the economy frommoving away from this approach and using legislation to protect consumers and impose minimum terms? ACTIVITY 2: READ THE ARTICLE BELOW NATIONAL AUSTRALIA BANK RESPONSE TO CAV CONSUMER CREDIT REVIEW [NAB opposes the extension of Part 2B of the FTA to consumer credit contracts] As has been discussed previously in ABA submissions on this issue, there is a need for both standard terms and unilateral change terms in banking contracts. Indeed these kinds of term are expressly contemplated in other Commonwealth and State legislation (such as Ch 7 of the Corporations Act 2001, and the Code) that mandate certain disclosures and impose prior notice requirements on the exercise of a unilateral right of variation. Accordingly there is long standing and widely held policy support for the view that terms in banking contracts that may, under the legislative test, be viewed as unfair have a number of functions that aid efficiency and in fact benefit consumers as they allow the relevant services to be provided efficiently and effectively with full and proper disclosure according to law. Do you find NAB’s argument (that making consumer credit contracts subject to Part 2B of the FTA is contrary to consumers’ interests) convincing? ACTIVITY 3: ANSWER TRUE or FALSE TO QUESTIONS BELOW Mr Ned’s hobby is making chairs which he keeps for himself, sells to friends at cost, and gives away to charity. Mr Ned purchases a wood-cutter that costs $45,000.00 and is of a type generally used only by high volume furniture manufacturers. Mr Ned is protected by the TPA consumer protection sections? TRUE or FALSE An advertisement that makes exaggerated claims will be a “mere puff” and will therefore not be subject to misleading and deceptive conduct provisions. TRUE or FALSE Only corporations in trade and commerce and individuals involved in interstate trade or overseas trade are subject to the Fair Trading Act (Vic) 2001. TRUE or FALSE Section 52 of the Trade Practices Act prohibits misleading and deceptive conduct. It can be used by one corporation as a weapon against another corporation it thinks is misusing its image. TRUE or FALSE The exact wording of the Commonwealth Trade Practices Act and the Victorian Fair Trading Act are different with regards to implied conditions and warranties. TRUE or FALSE Docsity.com