Recent case puts boardroom behaviour under the spotlight

The recent decision of the Federal Court in ASIC v Australian Property Custodian Holdings Limited shines a light on decision making in the boardroom and corporate record keeping.

This is a must read case for directors and particularly directors of responsible entities. In this case ASIC brought proceedings against the Company and each of its directors alleging breaches of duties owed in the capacity as responsible entity of the Prime Retirement and Aged Care Property Trust.

The decision of Murphy J outlines the nature of the duties of a responsible entity and the directors of the responsible entities and held that the company and its directors at the relevant time breached a number of statutory duties that they owed to the Prime Trust members.