Task A 1. What is the business judgment rule (5 marks) and what is the principle behind it? (15 marks) 2. Justice Austin compares the US model and the Australian position in respect of business...

Task A

1. What is the business judgment rule (5 marks) and what is the principle behind it? (15 marks)
2. Justice Austin compares the US model and the Australian position in respect of business judgment rules. Who, according to Justice Austin, bears the burden of
proof of the elements of s180(2)? (5 marks) Is this the same as the position taken in America in respect to its business judgment rule? (5 marks)
3. Does Justice Austin agree with ASIC’s submission that in Australia (unlike America) the defence is not available if the decision taken by the director is
based on an unreasonable belief? (5 marks) Why? (15 marks)


Task B (50 marks)


Read paragraphs 13 and then 439 to 562 in Part VII: Duties of Care and Diligence – Section 180 of the judgment in Australian Securities and Investments Commission v Mariner
Corporation Limited [2015] FCA 589 and answer the following questions:


1. Was ASIC successful in its claims that the directors had breached their s180(1)duty to act with due care and diligence? (5 marks)
2. How did Justice Beach describe the framework within which s180 must be analysed? (10 marks)
3. Do you think Justice Beach recognizes the need for directors to take an entrepreneurial approach on occasions? Why or why not? (10 marks)
4. Did Justice Beach find that the elements of the statutory business judgment rule in s180 (2) had been met by each of the directors? (5 marks) Was Justice
Beach required to apply the rule? Why or why not? (10 marks)
5. How does the decision in ASIC v Mariner compare to the decision in ASIC v Rich referred to in Task A? (10 marks)