Greyson Legal - Corporate Lawyers
What We Do
At Greyson Legal, we provide a range of corporate law legal services, including:
Company acquisitions & sales
Contract preparation & advice
Corporate compliance advice
Share Sale Agreements
Constitution review & advice
Advice in relation to directors duties and shareholder rights
What is a Limited (Ltd) Company ?
This is a company in which the liability of the members/shareholders is limited to what they have invested.
Limited companies may be limited by shares or by guarantee.
Under the Corporations Act 2001 (Cth):
limited by shares means the liability of the company’s members limited to the amount (if any) unpaid on the shares respectively held by those members;
limited by guarantee means the liability of the company’s members is limited to the amount the members undertake to contribute to the assets/property of the company if it is wound up. Usually the members will agree to a nominal amount – say $10 or $30.
What is a Private Company ?
These are known as proprietary companies (Pty) and are smaller than the public companies. They are often adopted by small businesses owners.
What is Limited Liability ?
The main advantage in adopting a proprietary limited (“Pty Ltd”) company structure is the shareholder’s ability to limit their liability to the amount which remains unpaid on their respective shares.
This means, (subject to all statutory obligations and other matters of law being complied with) in the event the company experiences financial difficulty resulting in it being wound up, each shareholder’s loss or risk is limited to the amount which remains unpaid on their shares.
What is a Public Company ?
Generally, a public company is able to raise money from the public by offering their shares for sale through listing them on the share market.
How are Companies Regulated ?
Companies in Australia are regulated through the Australian Securities & Investments Commission (ASIC).
ASIC achieves this through administering various pieces of legislation including the Corporations Act 2001 (Cth).
What is Incorporation ?
Companies can be incorporated through a registration process by applying in the prescribed form to ASIC. Upon registration, a company is issued an Australian Company Number (ACN) and a certificate of registration issued.
What is a Separate Legal Entity ?
A company is a separate legal entity distinct from its directors and shareholders.
A company can continue to survive even where there is a change in directorship or shareholding. The company is said to have perpetual succession.
As a separate legal entity, the company has powers like a person. It can own and dispose of property and other assets and will be able to contract, sue and be sued in its own right.
Company’s Constitution and Replaceable Rules
A company’s constitution sets out certain powers and duties with respect to the internal management of the company.
However, where certain criteria is met, a company can elect for its internal management to be governed by the replaceable rules contained in the Corporations Act 2001 (Cth).
Directors manage the business and other affairs of a company.
There are numerous obligations imposed on directors of companies as set out in the Corporations Act 2001 (Cth). Such obligations include, among others:
make sure the company pay its debts when due
keep proper financial records
act in the company’s best interests
not be bankrupt
act with due care and diligence
not to use their position or information obtained through their position improperly
Shareholder (or Members)
The shareholders represent the ownership of the company. Shareholders are not liable for the company's debts per se. In terms of proprietary limited companies, generally the only financial obligation as a shareholder is to pay the company any amount which remains unpaid on their shares.