Home / Practice areas / Corporate Law
The clauses that only matter once.
Structuring, shareholders agreements, business sales, directors' duties, statutory demands and shareholder disputes. Advice that anticipates the argument.
Corporate work is where the smallest documents do the heaviest lifting. A shareholders agreement drafted in an afternoon decides what happens when two founders stop agreeing five years later. We spend our time on the clauses that only matter once.
Structure and governance
- Company and trust structuring. Choosing between a company, a unit trust, a discretionary trust or a partnership, with an eye on asset protection and on the way you actually intend to trade.
- Shareholders and partnership agreements. Drag along and tag along rights, pre-emptive rights, deadlock mechanisms, valuation methods, restraints, and the exit nobody wants to talk about at the beginning.
- Directors' duties. Sections 180 to 184 of the Corporations Act 2001 (Cth), the duty to prevent insolvent trading under section 588G, conflicts, related party transactions and ASIC compliance.
- Constitutions and resolutions. Getting the paperwork right before a bank, a buyer or a liquidator reads it.
Transactions
We act on the sale and purchase of businesses and companies: heads of agreement, due diligence, share sale and business sale agreements, restraints of trade, employee transfers, earn outs, and the completion mechanics that determine who owns the debtors ledger on the day.
Our approach on deals is unfashionable. We try to reduce the number of pages. Every clause that is negotiated is a clause somebody is paying for, and most of them will never be read again.
Disputes between the people who own the thing
- Shareholder oppression. Sections 232 and 233 of the Corporations Act give the court broad power where the conduct of a company's affairs is oppressive, unfairly prejudicial or unfairly discriminatory. The usual remedy is a buy out, on a valuation the court decides.
- Deadlock. Fifty fifty ownership with no mechanism to break a tie is the most common structural fault we see.
- Statutory demands. A creditor's statutory demand under section 459E must be answered within twenty one days by payment, agreement or an application to set it aside under section 459G. That period cannot be extended. Miss it and your company is presumed insolvent.
- Insolvency risk. Voidable transactions, unfair preferences, and the safe harbour provisions in section 588GA.
If your company has received a statutory demand, the clock is already running and the court has no power to extend it. This is the most common way an otherwise solvent business ends up defending a winding up application.
Commercial contracts
Supply agreements, distribution and agency, services agreements, terms and conditions of trade, licensing, confidentiality and personal property securities registrations. We draft them in plain English because a contract that the operations team cannot follow is a contract that will not be followed.
How we bill corporate work
Advisory and drafting work is usually scoped and quoted as a fixed fee. Disputes are estimated by stage. Either way you know the number before we start, and we tell you when a document you have asked for is not the document you need.
Common questions
Corporate Law, answered.
How long do I have to respond to a creditor's statutory demand?
Twenty one days from service. Within that period the company must pay the debt, reach an agreement with the creditor, or apply to the court under section 459G of the Corporations Act 2001 to set the demand aside. The period cannot be extended, and failure to comply raises a presumption of insolvency that supports a winding up application.
Do we really need a shareholders agreement?
If more than one person owns the company, yes. The constitution and the replaceable rules do not deal with valuation on exit, deadlock, restraints, or what happens if a shareholder dies, divorces or simply stops turning up. Those are the questions that later become litigation.
What is shareholder oppression?
It is conduct of a company's affairs that is contrary to the interests of members as a whole, or oppressive, unfairly prejudicial or unfairly discriminatory against a member. Sections 232 and 233 of the Corporations Act give the court wide remedies, and the most common is an order that one side buy out the other at a valuation the court fixes.
Can a director be personally liable for company debts?
Yes, in several situations: insolvent trading under section 588G, personal guarantees, unpaid PAYG and superannuation the subject of a director penalty notice, and breaches of directors' duties. Incorporation is protection, not immunity.
Do you act on business sales and purchases?
Yes. We handle heads of agreement, due diligence, share and business sale agreements, restraints, employee transfers and completion. We generally quote a fixed fee once we have seen the deal terms.
Whatever it is, we can figure it out together.
A first conversation costs you nothing. You will speak with Hanna, not a call centre, and you will leave knowing what your options are and roughly what they cost.