3 Comments Commercial law, litigation, contracts, IP, property law
I think your concerns are justified, as a director you would be personally liable if the company breaks any of the relevant laws. I would not touch this without personal guarantees from the other party and to ensure these were enforceable may be a step too far.
Just consider this, what if those aeroplane parts actually contain drugs???
Agree with Citizen Joe - if you are named Director, you are also responsible for any financial debt also.
Your friend does not need to be registered in Australia for tax purposes, however with no ABN, he is unable to claim back GST. ( He may be able to claim back once he has his ABN )
In the interim, he can apply for a CCID ( Customs Client Identifier ) with Border Force, and can use that on the import entries as owner of the Imported goods.
He will need advice from an Australian accountant regarding if he can charge GST when he on-sells the parts here, and if he can claim back GST.
DO NOT be a Director in this circumstance.
Your above facts closely resemble the concept of a â€œsilent directorâ€. The above posts by the senior members of the forum correctly state that as a director you will be personally liable for any breaches. Recent development in case law and the directors' duties enshrined in the Corporations Act 2001 (Cth) make it clear that the directors are required to fulfil the duties and breach of any duty and responsibility can possibly make them personally liable.
In addition, it is both risky and wrong to conclude that a silent director does not have the same duties and responsibilities as an active director. To demonstrate this by way of an example, the Supreme Court of Western Australia held that sleeping director of the company was equally and jointly liable for breaches of the statutory duties even though the director did not actively took part in managing affairs of the company.
In short, as a director you must meet your obligations and failing to keep an active approach can possibly make you personally liable for the breaches.
Should you wish to discuss this matter further, please feel free to contact us via email on email@example.com, via phone on (03) 8564 8474 or visit our website at www.amklaw.com.au
jaazzz 2018-03-26 23:25:43