Company Law Review Act 1998 (61 of 1998)

Schedule 2   Consequential amendment of the Corporations Law

Part 1   Registering a company (new Chapter 2A) Basic features of a company (new Chapter 2B) Members' rights and remedies (new Chapter 2F)

68   After section 224A

Insert:

224B Single director/shareholder proprietary companies

Section applies to single director/shareholder proprietary companies

(1) This section applies to a proprietary company while its only director is also its only shareholder.

Appointment of director

(2) The director may appoint another director by recording the appointment and signing the record.

Powers and duties of director

(3) The director may exercise all the powers of the company except any powers that this Law or the company's constitution (if any) requires the company to exercise in general meeting. The business of the company is to be managed by or under the direction of the director.

Note: For example, the director may issue shares, borrow money and issue debentures.

Negotiable instruments

(4) The director may sign, draw, accept, endorse or otherwise execute a negotiable instrument. The director may determine that a negotiable instrument may be signed, drawn, accepted, endorsed or otherwise executed in a different way.

Director's remuneration

(5) The director is to be paid any remuneration for being a director that the company determines by resolution. The company may also pay the director's travelling and other expenses properly incurred by the director in connection with the company's business.

224C Company may appoint a director (replaceable rule - see section 135)

A company may appoint a person as a director by resolution passed in general meeting.

224D Directors may appoint other directors (replaceable rule - see section 135)

Appointment by other directors

(1) The directors of a company may appoint a person as a director. A person can be appointed as a director in order to make up a quorum for a directors' meeting even if the total number of directors of the company is not enough to make up that quorum.

Proprietary company - confirmation by meeting within 2 months

(2) If a person is appointed under this section as a director of a proprietary company, the company must confirm the appointment by resolution within 2 months after the appointment is made. If the appointment is not confirmed, the person ceases to be a director of the company at the end of those 2 months.

Public company - confirmation by next AGM

(3) If a person is appointed under this section as a director of a public company, the company must confirm the appointment by resolution at the company's next AGM. If the appointment is not confirmed, the person ceases to be a director of the company at the end of the AGM.