The Supreme Court of Victoria Inaugural 2009 Commercial Law Conference - Current Issues in Commercial Law

(12 November 2009)

Speakers: Mark Moshinsky SC, Victorian Bar;  Allan J Myers AO QC,  Victorian Bar; The Hon Justice Tony Pagone, Supreme Court of Victoria; Professor Ian Ramsay, Melbourne Law School; Jon Webster, Allens Arthur Robinson.

The James Hardie Case - A Timely Reminder to Consider Your D&O Cover and Deeds of Indemnity, Insurance and Access

(Sydney 5 November 2009, Melbourne 11 November 2009)

Speakers: David Abell, Senior Manager, ANZ Banking Group (Melbourne seminar); Craig Claughton, NSW Manager - FINPRO Marsh Pty Ltd (Sydney seminar); David Gerber, Senior Associate, Clayton Utz (Sydney seminar); Fred Hawke,  Partner, Clayton Utz (Melbourne seminar); Peter Mann, Partner, Clayton Utz (Sydney seminar); Nancy Milne, Consultant, Clayton Utz (Sydney  seminar); Charles Rosedale, Partner, Clayton Utz (Melbourne seminar); Paul Smyth, Manager,  Aon insurance (Melbourne seminar).

Description: The Supreme Court decision that James Hardie directors and officers were in breach of their duties resulting in the imposition of substantial banning orders and financial penalties, coupled with the Court's decision not to exonerate them, is a timely reminder that directors and officers should periodically review their D&O Insurance and Deeds of Indemnity, Insurance & Access.

  • Does your D&O Insurance comply with the requirements of your Deeds of Indemnity, Insurance and Access? If not, which of them has to change?
  • Does your D&O insurance provide cover for legal representation at investigations and inquiries and criminal prosecution defence costs, involving ASIC, ASX, APRA or other commissions, tribunals and regulatory agencies?
  • Will you be able to retain solicitors and Counsel of your choice?
  • If ASIC launches proceedings for breach of duty - as it did against all James Hardie directors, the company secretary/general counsel and CFO, or if shareholders or others bring claims to recover losses - who will pay your civil defence costs?
    • Will all of your costs be paid by the insurer, or will you be out of pocket?
    • Will you have to pay a "gap" cost, between your preferred lawyer's charge rate and that the insurer considers "reasonable"? Who decides what is reasonable?
  • Does the insurance cover:
    • Pecuniary Penalties;
    • Compensation Orders;
    • the regulatory agency's legal costs?
  • Will you have to fight the company and your fellow directors for your share of the policy limit?
  • Indemnity, Insurance & Access Deeds:
    • what protection is it reasonable to expect?
    • what are your rights and obligations?
    • is your deed up to date and compliant with your Constitution and the Corporations Act

Regulation of Executive Remuneration: An Empirical Study of the First Three Years of a 'Voting and Disclosure' Regime in Australia and the UK

(4 September 2009)

Speaker: Kym Sheehan, University of Sydney.

Description: In the seminar, Kym will present the findings of her empirical study of the ‘voting and disclosure’ regime on executive remuneration, which is part of her thesis. Legislation by the UK government in 2002 and the Australian government in 2004, targeted at improving executive remuneration practices in listed companies, was only partially successful in achieving the stated policy goals. The model of the regulatory framework for executive remuneration developed in the thesis, together with empirical evidence of its initial operation, explain why these reforms were unsuccessful. The study provides insights for the current round of government policy making and legislative reforms in executive remuneration.

Corporate Social Responsibility: International Legal Developments

(1 September 2009)

Speaker: Michael Kerr, Natural Advantage, Canada.

Description: In this seminar, Michael will be sharing important insights regarding:

  • The new role the law in Australia and globally is playing to mandate CSR;
  • How key international voluntary initiatives are interacting with the law to promote CSR;
  • The important role for CSR as world leaders seek regulatory solutions to the global financial crisis; and
  • The future direction of CSR.

Directors' Duties in a Time of Crisis

(12 August 2009 Melbourne, 8 September 2009 Sydney)

Speakers: Tim Bednall, Partner, Mallesons Stephen Jaques (Sydney seminar); David Crawford, A.O. (Melbourne seminar); David Gonski, A.C. (Sydney seminar); Alison Lansley, Partner, Mallesons Stephen Jaques (Melbourne seminar); Stuart McCulloch, Partner, Allens Arthur Robinson (Sydney seminar); Jon Webster, Partner, Allens Arthur Robinson, (Melbourne seminar).

Description: The global financial crisis means that the environment in which directors are operating is more challenging and more difficult than ever before. In addition, there is increased scrutiny of the decisions of company directors – by shareholders, creditors, government, the courts, the media and others.

Two major challenges for directors are directors' duties in times of financial difficulty and directors' duties and executive remuneration. This seminar brings together leading speakers to discuss the following important topics:

  • Directors' duties in insolvent situations
    • Insolvent trading tests
    • Duty to act in good faith and for proper purposes
    • Duty to consider creditors' interests
    • Interests of the company rather than the group
    • Corporate benefit and s187 of the Corporations Act
  • Directors' duties and the remuneration challenge
    • Executive remuneration and the role of the Board and shareholders - regulatory response to community rage
    • Australian Productivity Commission inquiry - where is it headed and what are the likely outcomes?
    • Executive termination benefits - what will the new legislative restrictions mean for executive contracts and disclosure, and how should Boards deal with these issues?
    • NED remuneration - where is it headed?

Enforceable Undertakings Roundtable

(23 June 2009)

Speakers: Richard Johnstone, Griffith University School of Law; Christine Parker, Melbourne Law School.

Description: Enforceable undertakings (EUs) are promises enforceable in court, offered by an individual or firm who has allegedly breached the law and accepted by a regulator. The EU serves as a substitute for, or augmentation of, other regulatory enforcement methods such as civil, administrative, or even criminal action. EUs are designed to secure quick and effective remedies for contraventions of regulatory provisions and provide non-adversarial and constructive solutions to regulatory compliance issues.

EUs are an Australian invention. The concept was developed by the Australian Competition and Consumer Commission. The Australian Competition and Consumer Commission and Australian Securities and Investments Commission have had the legislative power to accept EUs since 1993 and 1998 respectively. In more recent years, many other federal and state regulatory agencies have been given the power to accept EUs. Some have used this power quite extensively and creatively. Others have not used it at all yet or have only just received the power.

The purpose of this roundtable is to share insights and experience about how best to use the power to accept EUs, and what issues need to be addressed in doing so. 


The James Hardie Decision - Implications for Directors and Their Advisors

(16 June 2009 Melbourne, 25 June 2009 Sydney)

Speakers: Priscilla Bryans, Partner, Freehills (Melbourne seminar); Alan Cameron, A.M. (Sydney seminar); Quentin Digby, Partner, Freehills (Sydney seminar); Colin Galbraith, A.M. (Melbourne seminar); Bill Koeck, Partner, Blake Dawson (Sydney seminar) and Marie McDonald, Partner, Blake Dawson (Melbourne seminar).

Description: The decision of the NSW Supreme Court in James Hardie is one of the most widely discussed judgments in recent years. It was extensively reported in the media and its implications are now being analysed. The court found that seven former non-executive directors and three former executives of James Hardie had breached their duties. James Hardie was also found to have breached disclosure obligations in relation to ASX announcements. In its media release of 23 April 2009, ASIC stated that the judgment is “a landmark decision in Australia on corporate governance”. ASIC also states that the decision provides directors with important guidance on (a) the practical application of the scope and content of the duties of executives (CEOs, CFOs and company secretaries) when taking important matters to the Board and disclosing those matters to the market; and (b) the responsibilities of non-executive directors when asked by management to consider strategic matters and to approve disclosure to the market of the Board’s decisions.

This important seminar brings together well-known speakers to discuss the implication of the James Hardie decision. The topics discussed by the speakers include:

  • How company directors should react to the decision in James Hardie, in particular, the way in which meetings are conducted and recorded, and the implications for the business judgment rule.
  • The implications of the decision in relation to the allocation of responsibilities and liabilities between non executive directors and executive officers when preparing and approving key ASX announcements, circumstances in which a director may be held responsible for a draft announcement they have not seen and management’s obligation to fully inform the Board about the content in (and background to) a draft announcement.
  • Who is the relevant audience for directors to consider when authorising company announcements?
  • Intersection between the court’s findings in James Hardie and continuous disclosure (and the obligation to announce immediately once an executive officer is aware of price sensitive information).
  • Implications of the decision for Board processes (draft minutes, agenda, process for decision-making and authorising announcements, role of advisors, urgently convened meetings).

Issues in Market Integrity and Regulatory Responses

(23 April 2009 Melbourne, 13 May 2009 Sydney)

Speakers: Cathie Armour, Executive Director, Macquarie Capital Advisers (Sydney seminar); Belinda Gibson, Commissioner, Australian Securities and Investments Commission (Melbourne and Sydney seminars); Michael Hoyle, Division Director, Macquarie Capital Advisers (Melbourne seminar); John Kluver, Executive Director, Corporations and Markets Advisory Committee (Melbourne and Sydney seminars); Robert  Nicholson, Partner, Freehills (Melbourne seminar); Leon Pasternak, Partner, Freehills (Sydney seminar).

Description: The government has requested the Corporations and Markets Advisory Committee (CAMAC) to provide advice to it by 30 June 2009 on key market integrity issues. In its request, the government states that “as a result of the global financial crisis and the related turbulence in Australian financial markets, the effect on the market of a number of practices has given rise to a significant degree of concern in the business, and broader, community” and “the lack of transparency and accountability surrounding some of these practices could mean that there is potential for damage to the integrity of the market and investor confidence”. The government has asked CAMAC to advise whether changes are required to Australia’s regulatory framework. Last month, CAMAC published an issues paper calling for submissions on the matters discussed in the paper, including spreading false or misleading information, corporate briefings to analysts, “blackout” trading by company directors, and margin lending to directors.

This important seminar brings together leading speakers to discuss key market integrity issues. ASIC Commissioner Belinda Gibson will speak on ASIC’s enforcement and other work in the area of market integrity. John Kluver from CAMAC will advise on the status of CAMAC’s inquiry, including submissions received by CAMAC. Other speakers will discuss the changing regulatory framework for short selling, spreading false or misleading information and will also comment on other issues raised for consideration in the CAMAC paper and debate the need for any new regulatory measures to safeguard the integrity of the Australian financial market in light of the experiences of the global financial crisis.