Thaiwood Ltd (Singapore) develops plantation land. It instructs Rocker to setup an Australian subsidiary. Rocker lives in Australia, the other directors live in Singapore. Rocker is instructed by Thaiwood to buy a property in Victoria. Rocker signs a purchase contract in his name, for and on behalf of Auswood Ltd. Rocker is one of three directors of Thaiwood Ltd and the same directors are proposed for Auswood. Rocker tells the vendor Greenhills Limited that the contract is to be changed to the name of Auswood Ltd as soon as it is established. Rocker also engages Treefellers Pty Ltd to clear the boundary. Without checking with Rocker, Treefellers begin clearing only to be stopped by an injunction filed by the EPA.
Auswood Ltd is established. Auswood’s prospectus aims to raise money to develop plantation wood. Auswood’s directors learn that the Victorian site is not suitable because of environmental legislation. The EPA have filed for breaches of their Act against Treefellers Pty Ltd. Greenhills provides notice requiring settlement.
Explain who is liable, if anyone:
(a) On the contract for the purchase of land. (b) On the contract for clearing.
Advise the directors of Auswood Pty Ltd regarding their duties.
Answer only in respect to the Corporations Act 2001; do not address any property or conveyancing issues or law.
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