The June 2010 change to the manner in which dividends were deemed payable shifted the requirement from a measure of profit to a balance sheet-based formula in which dividends were only payable if assets outstripped liabilities, essentially.

This is, according to the facts of the case as presented, the only reason the dividend payment might be considered insolvent trading or otherwise contrary to the legal and financial constraints of the company under current Australian law. As the error was again solely the fault of chief financial officer George, the directors incur no liability in this instance.

Part B

As described above, the board of directors at Hampton Park Pty, Ltd. incurred no liability in this case as they relied on information provided by a competent and informed employee in the person of the company's chief financial officer, George, which legally absolves them of liability in this case.

Whether or not...
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