Corporations (Aboriginal and Torres Strait Islander) Act 2006

CHAPTER 4 - MEMBERS AND OBSERVERS  

PART 4-4 - PROTECTION OF MEMBERS ' INTERESTS  

Division 169 - When may a person bring or intervene in proceedings on behalf of an Aboriginal and Torres Strait Islander corporation?  

SECTION 169-5   APPLYING FOR AND GRANTING LEAVE  
Who may apply for leave?

169-5(1)    
A person referred to in paragraph 169-1(1)(a) may apply to the Court for leave to bring, or to intervene in, proceedings.

Court to grant the application in certain circumstances

169-5(2)    
The Court must grant the application if it is satisfied that:

(a)    it is probable that the corporation will not itself bring the proceedings, or properly take responsibility for them, or for the steps in them; and

(b)    the applicant is acting in good faith; and

(c)    it is in the best interests of the corporation that the applicant be granted leave; and

(d)    if the applicant is applying for leave to bring proceedings - there is a serious question to be tried; and

(e)    either:

(i) at least 14 days before making the application, the applicant gave written notice to the corporation of the intention to apply for leave and of the reasons for applying; or

(ii) it is appropriate to grant leave even though subparagraph (i) is not satisfied.

This subsection has effect subject to subsections (3) and (5) .

When leave is not in the best interests of the corporation

169-5(3)    
A rebuttable presumption that granting leave is not in the best interests of the corporation arises if it is established that:

(a)    the proceedings are:

(i) by the corporation against a person who is not a related party of the corporation; or

(ii) by such a person against the corporation;

(including any appeal from a decision made in proceedings by or against the corporation); and

(b)    the corporation has decided:

(i) not to bring the proceedings; or

(ii) not to defend the proceedings; or

(iii) to discontinue, settle or compromise the proceedings; and

(c)    all of the directors who participated in that decision:

(i) acted in good faith for a proper purpose; and

(ii) did not have a material personal interest in the decision; and

(iii) informed themselves about the subject matter of the decision to the extent they reasonably believed to be appropriate; and

(iv) rationally believed that the decision was in the best interests of the corporation.

Note:

Related party is defined in section 293-1 .

169-5(4)    
A director ' s belief that the decision was in the best interests of the corporation is a rational one unless the belief is one that no reasonable person in his or her position would hold.

Decision taken to give effect to Native Title legislation obligation

169-5(5)    
The Court must not grant the application if:

(a)    the corporation has decided:

(i) not to bring the proceedings; or

(ii) not to defend the proceedings; or

(iii) to discontinue, settle or compromise the proceedings; and

(b)    an officer or employee of the corporation made that decision:

(i) in good faith; and

(ii) with the belief that making the decision was necessary to ensure that the corporation complies with a Native Title legislation obligation.