Sweet, Ness & Light Pty Ltd has been making chocolates in Perth since 1923.The company was commenced by Ivan Light (now deceased) and has had amember of the Light family as Chair of the Board ever since. Presently, William(Bill) Light is Chair. The other shareholders are Bill’s sons Jack and Daniel, andtheir wives, Yvette and Jacinta. There are two non-family shareholders: the longtime company secretary Maxwell Sweet and Ivan Light’s former businessassociate Elliot Ness.Jacinta has harboured feelings of powerlessness as Bill’s sons lamely followwhatever their father wants with company matters. Elliot takes no active interestin the company, and Maxwell maintains absolute loyalty to Bill when it comes tocompany decisions.At a general meeting last week, members voted on Bill’s proposal to not paydividends out of recent profits, but to reinvest them. This is the fourth year in arow that Bill has done this with the member’s approval. In another resolution,the company decided to restructure its shares. There are to be additional sharesthat will only be available to Bill, Jack, Daniel, Maxwell and Elliot. The reason isthat Yvette and Jacinta are seen as threats to the company if their marriagesshould fail. Maxwell and Elliot are unlikely to take up the additional shares andJack and Daniel are presently speaking to their financial advisers about theirability to invest more money into the company. Jacinta sees this latest move asthe ‘last straw’.Advise Jacinta on her legal position as a member.Suggested answer:Personal rights for Jacinta:While there are a number of rights available to Jacinta to inspect the books of thecompany, to require reports and various other rights etc. The most relevant right ofaction for Jacinta is to claim the company (through its operators) is conducting itsaffairs oppressively as per s 232.Jacinta may have a case to argue that her fellow members are acting unfairly,discriminating against her and generally acting in an oppressive manner so that theinterests of the company (and all members) of the company demand the court takeaction. Jacinta might claim the discrimination she has suffered is sufficient to invoke acourt action.A court under s 233 can make a variety of orders; Jacinta may wish to leave thecompany and receive an order from the court that fellow members buy her out, orcompensate her, or carry put in place certain actions by order of the court.Much depends on whether Jacinta wants to leave the company or stay in the companyunder certain conditions. Jacinta might even ask the court to implement an order towind up the company altogether under s 461(1).
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