85Duty of good faith and proper purpose

85 Duty of good faith and proper purpose (1) An office holder of an incorporated association must exercise his or her powers and discharge his or her duties— (a) in good faith in the best interests of the association; and (b) for a proper purpose. Under section 146, subsection (1) is declared to be an applied Corporations legislation matter in relation to the provisions of Part 9.4B (Civil consequences of contravening civil penalty provisions) of the Corporations Act. The effect of that application is that subsection (1) is a civil penalty provision and a person who contravenes this provision may be ordered to pay a pecuniary penalty of up to $20 000. (2) This section— (a) has effect in addition to, and not in derogation of, any rule of law relating to the duty or liability of a person because of their office or employment in relation to an incorporated association; and (b) does not prevent the commencement of civil proceedings for a contravention of a duty or in respect of a liability referred to in paragraph (a).