T-Beverages Ltd

has just wrapped up its

financial year, and the board is feeling generous. Even though the company’s

profits are lower than expected, Hunk (the CEO) suggests paying a dividend to

keep shareholders happy — especially with the next AGM coming up.

However, when you check the financial records, you noticed something

odd:

• The company’s total assets are $500,000.
• Its total liabilities are $490,000.

• If the proposed dividend of $50,000 is paid,

  liabilities will exceed assets.

You raise your concerns with Claire (the Chairperson), who

shrugs and says, "

You’re not convinced.

Required:

1. What

   are the legal requirements that must be met before a company can pay a

   dividend?

2. Based

   on your answer above, should the company pay dividends to the

   shareholders?

3. What

   are the potential legal consequences of paying dividends in this instance?

(1 + 1.5 + 1.5 = 4 marks)

Your friend Barry owns shares in

You're unsure whether

T-Beverages

Ltd

1. Are shareholders always permitted to freely

   transfer shares?

2. Can T-Beverages Ltd

   impose

   restrictions on the transfer of its shares through its constitution?

(1.5 + 1.5 = 3 marks)

Revengers Ltd. (a mid-sized superannuation fund) relying on

this information, invested $10 million. When the truth emerged and project

delays were confirmed, X-Mining’s share price fell sharply, resulting in

significant investor losses directly linked to the misleading statement.

Required:

(3 marks)

REQUIREMENT: 

• Hickman v Kent or Romney Marsh Sheep Breeders' Association

• Nibaldi v RM Fitzroy and Associates
• R v Firns
• Panorama Developments v Fidelis Furnishing
• Fraser v NRMA Holding Ltd.

YOU DO NOT NEED TO WRITE YOUR APPLICATION USING THE IRAC FORMAT!!

Jean

is the CFO of X-Mining Ltd, a company listed on the ASX. On Tuesday morning,

while scrolling through a private Discord server that only has 5 members

(comprised of finance professionals and enthusiasts) Jean comes across a post

by a user named “The Fiscal Alchemist.”. The post shares a blurry image of what

appears to be a whiteboard from an industry event, accompanied by the caption:

“Rumour

mill says X-Mining's booth at the Lithium Expo had something spicy scribbled

on a corner whiteboard. Something about ‘strategic positioning’ in WA...  Are we looking at the next lithium whisperer?

#notadvice #justvibes #XMining4Mars”

The

post is deliberately vague and satirical, with hashtags like #YOLOinvesting and

#notinsiderinfo, and it’s only shared within the closed Discord group. The information is not part of any official company

communication and is speculative at best.

Nonetheless,

Jean, amused and slightly intrigued, decides to purchase a significant number

of X-Mining shares. Later that week, an unrelated and surprising announcement

by a major EV manufacturer drives up lithium demand, causing X-Mining’s share

price to rise. Jean makes a substantial profit. ASIC is now investigating

whether Jean has engaged in any misconduct.

Required:

(5 marks)

REQUIREMENT: 

• R v Mansfield

• Nibaldi v RM Fitzroy and Associates
• Ashbury Railway Carriage v Richie
• Hooker Investments V Baring Brothers Halkerston Securities
• ASIC v Citigroup Global Markets

YOU DO NOT NEED TO WRITE YOUR APPLICATION USING THE IRAC FORMAT!!

James,

a 16-year-old high school student, is interested in investing in a small

start-up and decides to become a member of Bright Future Pty Ltd by purchasing

shares in the company. The company’s legal team informs him that he cannot

become a member because he is under 18 years old.

(3 marks)

GreenTech

Ltd is an ASX-listed technology company that has recently expanded its

operations globally. The board believes that the replaceable rules in the

(3 marks)

Jac, Keisha and Sunny

are the only directors and shareholders of a company called BigBrand Pty

Ltd.  BigBrand buys and sells a variety

of consumer goods in Australia. Jac is currently travelling overseas

negotiating a deal with a supplier. 

Keisha calls a shareholders’ meeting. Jac can participate in the meeting

by using Microsoft Teams.

(3 marks)

The

constitution of Maverick Enterprises Ltd states that the board of directors may

remove any director by passing a directors’ resolution. Barry, a director of

the company, is removed from the board after the other directors pass such a

resolution. This means Barry has been validly removed from office under the

Corporations Act.

(3 marks)

GreenEnergy

Ltd, an ASX-listed company, plans to release market-sensitive information about

a new solar technology. The CEO shares this information privately with a select

group of institutional investors. The periodic disclosure requirements under

the ASX Listing Rules are designed to prevent this kind of disclosure.

(3 marks)

Which of the following is true about a contract between members of GraceTech Industries?