When quorum cannot be constituted at shareholders’ meetings
In a dispute between shareholder and director or joint venture partners, particularly of a small proprietary company, or when company affairs are in deadlock, a common method of opposition by a shareholder is to refuse to attend a shareholders’ meeting so the necessary quorum is not present and the resolutions cannot be passed. In such circumstances, court may intervene to convene a meeting and prescribe a quorum.
Section 249G of the Corporations Act 2001 (Cth) (Corporations Act) provides that:
"249G – Calling of Meetings of Members by the Court
1. The Court may order a meeting of the company's members to be called if it is impracticable to call the meeting in any other way.
2. The Court may make the order on application by:
(a) any director; or
(b) any member who would be entitled to vote at the meeting.
Note: For the directions the Court may give for calling, holding or conducting a meeting it has ordered be called, see section 1319."
If a director or member of the company can establish that it is impracticable to convene a meeting in any other way for whatever reason, any director or member who would be entitled to vote at the meeting can make an application seeking order that a meeting to be convened, held and conducted in such matter as the court thinks fit, and may give such ancillary or consequential directions as it thinks fit under s 1319.
In general, impracticability will cover a wide range of circumstances including from where only directors and shareholders have been deceased to situations where it is extremely inconvenient or impracticable for a meeting to be ‘called’ (Jenashare Pty Ltd v Lemrib Pty Ltd (1993) 11 ACSR 345). However, if the company’s constitution or the Corporations Act offers a procedure for meetings to be called in the ordinary course of events, then the court ordinarily will not order that a meeting of the company’s members to be called unless there are exceptional circumstances with strong evidence.
Once impracticability is established, the court has the ultimate discretion to make or refuse the order. In Beck v Tuckey Pty Ltd (2004) 22 ACLC 633; 49 ACSR 555; [2004] NSWSC 357, Austin J referred to the following relevant considerations:
• whether the company had failed to comply with its statutory requirements;
• whether the company’s management was deadlocked; and
• whether the inconvenience was caused by the applicant.
It should be noted that:
• the court’s discretion under section 249G of the Corporations Act can be used to enable the appointment of an effective board of directors (Re Sticky Fingers Restaurant Ltd (1991) 10 ACLC 3011);
• however, section 249G does not allow the court a general power to give directions as to the conduct of a meeting;
• quorum requirements are not relevant to one member company. A company with only one member may pass a resolution by the member recording and signing the record (section 249B of the Corporations Act);
• for companies which elect to have replaceable rules apply as opposed to specific provisions in the constitutions, section 249T applies which provides that the quorum for a meeting of a company’s members is two members and the quorum must be present at all times during the meeting.
As demonstrated above, where there is a deadlock between shareholders which prevents the formation of a quorum at a general meeting, an application under section 249G can be made seeking the court’s intervention to call a meeting. Further, it is highly advisable to draft shareholders or joint venture agreements to manage the risk of a member bypassing the quorum requirement or the procedure and limitations where the quorum cannot be attained at a general meeting as a result of a member not attending.
Written by Victoria Cha
Written on 27 Oct 2021
Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.
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Directors’ Duties: Lessons from Recent Case Law
Australia is often viewed as one of the most heavily regulated jurisdictions in the area of corporate governance. On the one hand, it reflects a strong commitment to transparency, accountability and the protection of stakeholders’ interest, but on the other hand it poses a challenge for those looking to navigate the corporate regulatory landscape – all the more so for those not familiar with the Australian framework. When an offshore investor sets up shop in Australia or acquires a local company, often the first step taken is the appointment of a new director. Their role is not merely symbolic or perfunctory – the law imposes extensive duties on company directors, many of which are codified in the Corporations Act 2001 (Cth) (the Act). Directors owe a fiduciary duty to their company, meaning that they are required to act in good faith in the best interests of the company, exercise due care and diligence, and not misuse their position or information obtained by reason of their position. Recent judicial decisions, such as the New South Wales Court of Appeal’s ruling in Sunnya Pty Ltd v He [2025] NSWCA 79 (Sunnya decision), have further cemented the expansiveness of the scope of these obligations. Below, we discuss some of the issues canvassed in the Sunnya decision, following which we go over some of directors’ key duties in greater detail. Enduring nature of a director’s fiduciary duty In the recent Sunnya decision, the Court was asked to consider the temporal reach of a director’s fiduciary duty, and whether they bind a director even after their resignation from office. In the Sunnya decision, two former directors, Mr He and Ms Lu, were found to be in contravention of their fiduciary duties to Sunnya Pty Ltd (Sunnya). Sunnya’s business involved the export and sale of Australian and New Zealand manufactured milk powder products under the brand ‘Neurio’ to the Chinese market through distribution companies GABT and GNT, both owned by the former directors or their family members. Notably, Sunnya owned the Neurio trademark in Australia whilst GABT owned the trademark in China. After selling a majority stake in Sunnya to a third-party investor, Mr He allegedly attempted to transfer the Australian Neurio trademark from Sunnya to GABT without informing the other directors. After this effort failed, Mr He and Ms Lu resigned before registering a new trademark, NRIO, under GABT to continue selling the same product without interference from Sunnya. The Court found that the former directors had breached their fiduciary duties to Sunnya in attempting to transfer the trademarks and selling identical products, despite this occurring after their resignation. The two former directors were ordered to pay compensation to Sunnya in an amount to be determined for the loss suffered by the company or the benefit gained from their illicit act. Overall, the Court’s ruling made evident the fact that directors cannot evade their obligations by simply resigning. Care and diligence (section 180) Section 180 of the Act imposes a duty on directors to exercise their powers and discharge their duties with a reasonable degree of care and diligence. This is assessed on an objective standard, and courts will consider what a reasonable person would have done in the director’s position. A recent example of a judicial ruling on this provision can be found in ASIC v Holista Colltech Ltd [2024] FCA 244. In this case, the Federal Court found that the managing director and CEO of Holista Colltech Ltd (Holista), Dr Marnickavasagar, breached this s180 duty. In 2020, Dr Marnickavasagar authorised Holista to provide misleading representations and false information to ASIC regarding the sales figures of a sanitiser product, Natshield, that the company claimed to be effective against COVID-19. In these representations, Holista claimed that a third-party buyer had placed an order for 415,000 bottles of sanitiser with a projected revenue of $3.8 million, which had the effect of inflating the company’s share price. In reality, no such order had been made, and the company subsequently issued an announcement stating (again, falsely) that quarantine measures had disrupted supply networks, with projected sales having to be scaled back. Holista had a $1.8 million penalty imposed on them for breach of their continuous disclosure obligations and for engaging in misleading and deceptive conduct. Separately, the Court found Dr Marnickavasagar to be personally liable, on account of his contravention of s180 by causing or permitting Holista to breach the Act. The Court imposed a penalty of $150,000 and disqualified him from managing corporations for four years. Not only that, he had a costs order for $200,000 against him on account of ASIC’s legal costs in the proceedings. The case highlights how directors can be held personally liable for failing to exercise appropriate care and diligence, particularly where their actions result in regulatory breaches by and/or harm to the company. Non-Financial Risk and Emerging Obligations Some recent high-profile cases alleging failure to comply with s180 have included allegations about oversight of a company's non-financial risks. This trend is expected to continue, with increasing obligations on companies in key ESG (environmental, social, and governance) aspects such as climate emissions disclosure and transition management, cyber security risk management, and modern slavery reporting. Directors would do well to be cognisant that their duty of care and diligence necessarily evolves with the times, and will increasingly extend to the oversight of these non-financial risks, with regulatory scrutiny in these areas only set to intensify. Good Faith and Proper Purpose (section 181) Section 181 requires directors to act in good faith in the best interests of the company and for a proper purpose. In the Sunnya decision, it was found that the directors’ practice was to cause Sunnya to issue fraudulent invoices to evade import duties. The Court determined this practice was in breach of s181. The Court further held that a contravention would have occurred even if no improper purpose was actually achieved or if the improper conduct was intended to benefit the company – unlawful conduct could never be in the company’s best interests. This is the case even if a director honestly believes their conduct is in the best interests of the company – such belief must first be rational. Misuse of Position (section 182) Section 182 prohibits directors from improperly using their position to gain an advantage for themselves or someone else, or to cause detriment to the company. In the Sunnya decision, Mr He and Ms Lu was found to have adopted the practice of “under-value sales” during their tenure as directors. The practice involved Sunnya being made to sell Neurio products to GNT at low “export prices” for GNT to on-sell to other distributors. The Court found that both the under-value sales practice and the fraudulent commercial invoicing practice described above amounted to contraventions of s182. Specifically, the under-value sales practice was found to be in breach of the s182 as it was immediately financially disadvantageous to Sunnya and diverted financial benefits to another company owned by the former directors’ families. Directors ought to think twice before using their positions for illegitimate or self-serving purposes. Misuse of Information (section 183) Section 183 prohibits the misuse of information obtained as a director or other officer of a company. Directors must not use confidential or sensitive information acquired through their position to gain an advantage or cause detriment to the company, even after they have left office. Recently, the Western Australia Court of Appeal upheld the Supreme Court’s finding in Chaffey Services Pty Ltd v Doble (No 4) [2023] WASC 361 that related to a breach of s183. In this case, Mr Doble was employed as a supervising officer by Chafco Pty Ltd to oversee the maintenance of a mine site. During his employment, he used confidential information regarding the site to secure early finances for his own company, Kirahnley Pty Ltd, and to later acquire a contract for rehabilitation of the site from the landowner. The Court ordered the recovery of profits made from the misuse, emphasising that the information need not be inherently valuable for damages to be awarded. Although the case at hand involves a supervising officer, the provision of the Act equally extends to directors. Director’s Personal Liability As we have demonstrated above, directors who breach their duties under sections 180 to 183 will be personally liable for their contraventions, often in the form of compensation orders and/or civil penalties, as well as disqualification from managing corporations. In more serious cases, s184 will elevate breaches of sections 181 to 183 into criminal offences, potentially exposing directors to criminal prosecution with a maximum penalty of 15 years imprisonment. Beyond the general duties, directors must also be mindful of their more specific obligations, such as the duty to prevent insolvent trading under section 588G, as well as ensuring that the company is attending to its tax affairs in a timely manner. Directors should be mindful that the Australian Taxation Office may issue a Director Penalty Notice (DPN) to company directors concerning unpaid company tax debts, namely Pay As You Go (PAYG) withholding, Superannuation Guarantee Charge (SGC), and Goods and Services Tax (GST) liabilities, where a company fails to meet those tax obligations. Upon valid service of a DPN, directors then have a limited period (usually 21 days) to take specific actions, such as paying the debt, appointing an administrator, or beginning the process of winding up the company, or else end up being personally liable for such debts. Some takeaways Directors play a central role in the governance and success of Australian companies. Their responsibilities are both legal and practical, requiring a proactive and informed approach. With the privilege of heading up a company comes many responsibilities, and directors will serve themselves well by: • Understanding their duties: Directors must be familiar with their common law duties and statutory duties under the Act and what those duties entail. • Staying informed: Directors should keep abreast of changes in the law and regulatory environment, particularly in emerging areas such as ESG issues, climate risk, and cyber security. • Exercising care and diligence: Directors are expected to make informed decisions by reviewing all relevant information, asking questions, and challenging management where appropriate. Regularly reviewing and updating risk management frameworks is essential to ensure the company is prepared for potential threats. • Maintaining good governance: Effective governance requires clear policies and procedures for managing conflicts of interest, maintaining confidentiality, and ensuring that board decisions are made transparently and in accordance with the company’s constitution and policies. • Documenting actions and decisions: Keeping comprehensive records of board meetings, decisions, and the rationale behind them is vital. This documentation demonstrates that directors have fulfilled their duties and provides protection if decisions are later scrutinised. • Seeking guidance when needed: In situations involving complex legal, financial, or operational risks, directors should not hesitate to seek independent professional advice. This helps ensure that decisions are well-informed and defensible. By taking these steps, directors can not only comply with their legal obligations but also contribute to the effective management and long-term sustainability of their organisations.
Ad hoc and Institutional Arbitration
Arbitration is an increasingly preferred alternative to traditional litigation, particularly in commercial and international disputes. For businesses engaged in cross-border transactions, especially within the Asia-Pacific region, choosing between institutional and ad hoc arbitration can significantly influence the efficiency, cost and enforceability of dispute resolution. This article outlines key differences and practical considerations to help parties make informed decisions. Institutional Arbitration Institutional arbitration is conducted under the rules of a recognized arbitral institution, such as the Singapore International Arbitration Centre (SIAC), Hong Kong International Arbitration Centre (HKIAC) or the Australian Centre for International Commercial Arbitration (ACICA). These bodies offer a structured procedural framework and dedicated administrative support. The benefits of institutional arbitration include clearly defined rules that reduce procedural uncertainty, experienced panels of arbitrators and stronger international recognition of awards. Importantly, parties do not need to negotiate fees directly with arbitrators, as institutional rules often prescribe a fee schedule or allow the institution to manage these arrangements. The presence of a secretariat or case management team ensures that timelines are monitored and adhered to, minimizing procedural delays. Institutions also handle logistical and ancillary services such as transcription, interpretation, and hearing room bookings, relieving parties of the administrative burden. While institutional arbitration is often associated with higher administrative costs and reduced procedural flexibility, many institutions now offer streamlined rules and expedited processes to balance efficiency with oversight. Some institutions even extend their facilities, such as venues and financial administration services, to support ad hoc arbitrations, providing a hybrid option that blends autonomy with professional support. Ad hoc Arbitration Ad hoc arbitration does not involve an administering institution. Instead, the parties themselves agree on procedural rules, nominate arbitrators and manage the process independently. This approach offers greater flexibility and can be more cost-effective in the right circumstances. The appeal of ad hoc arbitration lies in its autonomy and adaptability. Parties can customise procedures to suit their commercial needs, potentially achieving faster outcomes with reduced expense. However, without institutional support, parties must arrange all aspects of the process, including arbitrator appointments, fee negotiations and ancillary services. This lack of infrastructure can lead to delays, especially when parties are uncooperative or disputes arise about procedure. Additionally, enforcement of awards may be more difficult if procedural irregularities affect the arbitration’s perceived legitimacy. Strategic Considerations for PartiesFor businesses operating in the Asia-Pacific, selecting the right arbitration model depends on factors such as dispute complexity, anticipated costs, international enforceability and the likelihood of party cooperation. Institutional arbitration is generally better suited to large-scale, cross-border disputes where predictability, enforceability and reputational assurance are important. The procedural structure and secretariat support offered by institutions can be critical in managing complex cases and ensuring compliance with deadlines. In contrast, ad hoc arbitration may be appropriate for smaller claims or domestic matters where parties are aligned on process and cost considerations and may still benefit from certain institutional services when needed. Ultimately, well-drafted arbitration clauses are essential. Legal advice at the contract negotiation stage can ensure that the chosen arbitration method aligns with a company’s broader commercial objectives and mitigates legal risk. As arbitration continues to expand across the region, businesses would do well to engage counsel experienced in both institutional and ad hoc frameworks to guide their approach. ConclusionWhile both institutional and ad hoc arbitration have their respective merits, the growing preference for institutional arbitration, reflected in a 2015 survey where 79 per cent of users opted for institutional mechanisms, underscores its practical advantages in the context of international commercial disputes. Institutions offer procedural certainty, administrative support, and enhanced credibility of awards, which are crucial when dealing with complex, cross-border matters. Additionally, the elimination of direct fee negotiations with arbitrators and the availability of ancillary services contribute to a smoother and more reliable process. Although institutional arbitration can be more costly and less flexible, its structured framework often proves more dependable, particularly where cooperation between parties is limited. Ultimately, the decision between institutional and ad hoc arbitration should be informed by the specific needs of the parties, the complexity of the dispute, and the importance of enforceability and procedural support.
How Can International Arbitration Be Made Cost Effective?
Making International Arbitration More Cost Effective International arbitration remains a preferred method for resolving cross-border disputes, especially in the Asia-Pacific. However, the process can be costly and protracted, often attracting criticism from commercial parties who seek timely and efficient outcomes. As arbitration continues to evolve in the region, cost effectiveness requires coordinated efforts from parties, arbitrators, institutions and legislators alike. Enhancing Efficiency Through Strategic PlanningMuch of the responsibility for controlling arbitration costs lies with the parties and their legal representatives. Early case assessment and a clear procedural strategy can significantly reduce inefficiencies. By developing a well-defined case theory from the outset, parties can better assess settlement options and avoid unnecessary procedural steps. Importantly, parties should give more thought to dispute resolution clauses before a dispute arises. Too often, these clauses are treated as boilerplate without due consideration of their strategic impact. This is the moment to agree to mechanisms that can streamline future proceedings, such as adopting the IBA Rules on the Taking of Evidence in International Arbitration, which typically provide for more limited disclosure than common law approaches. Likewise, agreeing on the preparation of core document bundles and the use of admissions, even where these may be unfamiliar in civil law jurisdictions, can help narrow the factual issues in dispute and avoid unnecessary fact-finding. Choosing the right arbitrator is equally critical. Opting for a sole arbitrator, particularly one with availability and relevant industry experience, can eliminate the risk of scheduling conflicts and streamline decision-making. This is especially important in the Asia-Pacific region, where access to experienced arbitrators is competitive. Technology also plays a key role in reducing costs. Remote hearings now offer a practical alternative to in-person appearances, eliminating travel expenses and enabling greater flexibility in scheduling. Additionally, focusing on essential evidence and narrowing the scope of issues helps prevent the arbitration process from becoming unnecessarily prolonged. Arbitrators as Drivers of Procedural Efficiency Arbitrators play a pivotal role in setting the tone for an efficient process. Active case management, through clear timelines, procedural orders and firm expectations, helps ensure alignment throughout the arbitration. A key efficiency measure is for arbitrators to clarify the live issues early on, either by preparing their own list for party comment or asking the parties to jointly define them. This can dramatically reduce the time spent arguing peripheral matters. While arbitration is, to some degree, the parties' process, arbitrators should not be overly deferential. Effective case management may require firm intervention. Arbitrators should feel confident using procedural tools such as bifurcation, summary dismissal, or early partial awards, and they should not be deterred by concerns that being prescriptive might affect future appointments or trigger challenges to the award. The tribunal has a responsibility not only to the parties but also to the integrity of the arbitral process. Limiting the volume of submissions and requiring parties to justify the relevance of their evidence are further levers that tribunals can use to ensure the arbitration stays focused and proportionate. Arbitrators should also remain alert to opportunities for early settlement. In jurisdictions such as Singapore and Hong Kong, where mediation is well integrated, they can encourage or facilitate early resort to alternative dispute resolution (ADR) mechanisms. Institutional Support and Legislative Reform Arbitral institutions in the region, including the Singapore International Arbitration Centre (SIAC) and the Hong Kong International Arbitration Centre (HKIAC), have taken steps to improve procedural efficiency. Many now offer expedited procedures that compress timeframes and reduce unnecessary steps, making them ideal for less complex or lower-value disputes. Institutions can go further by actively managing arbitrator availability, enforcing award delivery timelines, and promoting the use of ADR within the arbitration process. In countries such as Australia and New Zealand, where mediation is common, institutions could empower tribunals to stay proceedings to allow for meaningful settlement discussions. Legislation also plays a role. Clear statutory endorsement of summary procedures and expedited mechanisms can remove uncertainties about their enforceability and encourage broader adoption. Recent reforms in arbitration laws across the Asia-Pacific reflect a growing appetite for speed and economy in international arbitration. Practical Steps to Consider To maximise cost efficiency, parties and legal representatives should: • Carefully negotiate dispute resolution clauses during contract formation, considering procedural rules (e.g. IBA Rules) that limit scope and disclosure. • Include pre-arbitration settlement or ADR clauses in contracts. • Agree early on procedural matters such as timelines, core bundles and potential admissions. • Engage experienced arbitration counsel familiar with regional practices. • Limit evidence and witnesses to those strictly necessary. • Consider remote hearings wherever appropriate. Conclusion Cost effective arbitration is not achieved through isolated efforts. Instead, it requires a coordinated approach involving proactive parties, decisive arbitrators, supportive institutions and forward-looking legislation. By embracing efficient case management, agreeing procedural rules and issues upfront, leveraging technology and adopting expedited procedures, international arbitration can continue to serve as a reliable and commercially viable dispute resolution mechanism, particularly for businesses operating across the Asia-Pacific.
Freedom of Contract: Can parties contract out a statutory limitation period? The High Court says yes.
One of the basic principles of Australian contract law is freedom of contract: parties are free to enter into an agreement on whatever terms they choose. With that principle, a question always arises as to what extent parties can limit or exclude the operation or effect of statutes. In Price v Spoor [2021] HCA 20, the High Court of Australia concluded that a statutory limitation period under the Limitation of Actions Act 1974 (Qld) can be contracted out by an agreement between parties as it is not contrary to public policy. This case made a clear authority in dealing with the boundary of the freedom of contract to the extent of the statutory limitation period. However, caution should be taken in applying it. Background In 1998, Price as a mortgagor and Spoor as a mortgagee entered into two mortgage agreements, but a loan of $320,000 and interest were not repaid to Spoor when due and payable in July 2000. In 2017, Spoor brought proceedings in the Supreme Court of Queensland against Price to recover the principal sum and interest as well as for possession of the land secured under the mortgages. Price by way of defence and counterclaim argued that Spoor was statute-barred from bringing the action pursuant to the Limitation of Actions Act 1974 (Qld) (Limitation Act). In response, Spoor asserted that pursuant to clause 24 of the mortgage agreements, Price agreed not to plea a defence of limitation period. The Limitation Act relevantly provides that an action for breach of contract and that for the recovery of land shall not be brought after the expiration of 6 years and 12 years respectively. In the present case, Spoor brought the proceedings around 17 years after the repayment due date under the mortgages. Clause 24 of the two mortgages provides that: "The Mortgagor covenants with the Mortgage[e] that the provisions of all statutes now or hereafter in force whereby or in consequence whereof any o[r] all of the powers rights and remedies of the Mortgagee and the obligations of the Mortgagor hereunder may be curtailed, suspended, postponed, defeated or extinguished shall not apply hereto and are expressly excluded insofar as this can lawfully be done." Then, the main question before the High Court was, among others, whether the parties can effectively agree in a contract that either party would not rely on the statutory limitation defence. In other words, the question is whether parties can ‘contract out’ the statutory limitation period. The High Court’s Decision Earlier High Court cases already dealt with the effect of statutory limitation, discussed in Price v Spoor. In The Commonwealth v Mewett (1997) 191 CLR 471, Gummow and Kirby JJ said that a statutory bar in the case of a statute of limitations does not go to the jurisdiction of the court to entertain the claim but rather to the remedy available, and therefore to the defences which may be pleaded. In Westfield Management Ltd v AMP Capital Property Nominees Ltd (2012) 247 CLR 129, it was held that a person can waive or renounce its right conferred by a statute unless it would be contrary to the statute to do so. The High Court further went on to say that a contract will be ineffective or void where it operates to defeat or circumvent a statutory purpose or policy according to which statutory rights are conferred in the public interest. Accordingly, the above can be summarised as the following principles: 1. a limitation period is a right conferred on a party seeking to enforce the defence; and 2. a person is allowed to agree to abandon a statutory right conferred on them if that statute does not prohibit them from doing so or if that is not contrary to public policy. The High Court first found that there is no express prohibition against ‘contracting out’ of a statutory defence in the Limitation Act. Then, it went on to decide that while a statutory purpose of imposing a limitation period in the Limitation Act is to promote the finality in litigation, i.e. speedy resolution of disputes, the right conferred is rather an individual benefit which can be elected to utilise as a defence, and it does not intend to remove jurisdiction of the court even if a limitation period has ended. Further, the High Court found that clause 24 of the mortgage agreements effectively gave up the benefit provided by the Limitation Act, on the grounds that the parties intended that clause 24 has wide operation including provisions in the Limitation Act by making reference to its text, context and purpose as well as to the understanding of a reasonable businessperson. Steward J agreed with Kiefel CJ and Edelman J’s reasons but further emphasised that the inclusion of clause 24 is a legitimate adjustment of the private statutory rights by exercising their freedom of contract and noted an important attribute of contract law stated in Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656: “Exceptions from that freedom of contract require good reason to attract judicial intervention to set aside the bargains upon which parties of full capacity have agreed." Implications It is important to note that the High Court in Price v Spoor clearly rendered the decision that the parties can contract out the statutory limitation defence under the Limitation Act as such conduct is not contrary to the public policy. While bearing in mind this precedent, due regard should also be given to applying this to cases arising in different circumstances. The High Court in reaching its conclusion in Price v Spoor indeed considered the interpretation and the purpose of the Limitation of Actions Act 1974 (Qld) as well as the interpretation of a relevant clause in the contract. Each state in Australia has its own legislation governing statutory limitation period, and the policy reasoning behind each legislation may differ from state to state. Further, whether or not the parties effectively agree to contract out the statutory limitation period is ultimately dependent upon the construction of contract clauses. Therefore, it is worthwhile to note that parties intending to contract out or vary the statutory limitation period in their contract must obtain prior legal advice so as to ensure that such intention is effectively incorporated and enforceable against a breaching party. Finally, it should be noted that a term that purports to waive rights under a statute which serves a public purpose will not be enforceable. For example, an employment contract that purports to waive or renounce employee’s rights such as minimum terms and conditions under the Fair Work Act 2009 (Cth) will be unenforceable. Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.