LAWS4001 Lecture Notes - Lecture 1: Capital Market, Foreign Corporation, Australian Securities Exchange
Week 1 – Overview of Australian Corporations Law & Partnerships
My notes & Bernards
CHAPTER 1
Perennial Questions
When corporate law was developed, English law was in the process of laying down its
modern liberal foundations
The political philosophy of liberalism emphasizes that society is made up of private
individuals who poses rights, owe each other duties, and should be personally liable for
their actions
Historical points of tension
1. The group v the individual
oShould members of a group enterprise be able to minimize the risk of
commercial failure by limiting their liability, or should the same principles of
legal responsibility apply as for individual traders?
oShould a group be able to hold title to property as distinct from the individual
the individual members?
oShould a group be able to pursue or defend legal claims to the exclusion of
individual members?
2. The roles of ‘management v ownership’
oLarge corporations are structured in a way which seperates the ownership
function of members from the management function of directors and company
officers
oExternal responsibility and accountability – e.g. how should creditors and
customers be addressed?
oMatter of contractual negotiation or should the state set standards or rules
3. Debate between ‘facilitation v intervention’
oWhat is the role of government regulation in relation to corporations?
oThe law should assist individuals in the private pursuit of profit because this, in
turn, will promote economic efficiency
4. Tension of ‘private v public’
oTo what extent should corporations be regarded simply as associations created
by and operating for the benefit of, private initiative
oVerses a view in which because they owe their legal existence to the state, they
have broad public or social responsibilities
Summarising developments in British corporate history
The development of company law shifted away from the reliance on judicial decisions
towards an increasingly legislated structure
The practical significance during the 19th C shifted from offering incorporation as a way
of facilitating the large-scale raising of public funds by joint stock companies, to small
companies hoping to escape the disadvantages of partnership law and gain the benefit of
limited liability (members and shareholders would themselves not be liable for the
debts and liabilities of thee company) [Salomon v Salomon 1897]
Public companies developed from the joint stock companies via the deed of settlement
companies (the basic legal elements of modern corporations were put into place)
Private companies joined the process later on, as sole proprietors and partnerships took
advantage of incorporation laws
Australian history
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Week 1 overview of australian corporations law & partnerships. When corporate law was developed, english law was in the process of laying down its modern liberal foundations. The political philosophy of liberalism emphasizes that society is made up of private individuals who poses rights, owe each other duties, and should be personally liable for their actions. The development of company law shifted away from the reliance on judicial decisions towards an increasingly legislated structure. Public companies developed from the joint stock companies via the deed of settlement companies (the basic legal elements of modern corporations were put into place) Private companies joined the process later on, as sole proprietors and partnerships took advantage of incorporation laws. The states had strong reliance on british legislation for regulating commercial activity until well into the twentieth century. Little impetus to establish local company laws due to lack of strong local involvement in large scale commercial ventures.
