Discuss the liability of the person(s) involved Ajax Pty Ltd in the following situations:

i) At a Board Meeting of Ajax Pty Ltd, all directors approved the annual financial statements without reading the documents. A short-term debt of $100,000 was incorrectly referred to as long-term debt. The debt was due at the end of this year. As a result, the company had to borrow at a high-interest rate to repay the debt. Discuss the liability of the directors; and

ii) Ajax Pty Ltd faced financial stress. It was not able to pay its rent for the last 3 months. Other bills were left unpaid. The total amount owing including rent was $30,000. At a Board Meeting, the three directors were debating on whether to market a new product. The three directors are Jason, Alan and Ben. Jason, a non-executive director was doubtful as to its potential sales. He wanted to reduce the existing debt. He voted against the decision. The other two directors felt that manufacturing the new product would result in increased sales. To manufacture this new product, the directors entered into a contract to purchase raw materials worth $10,000 from Carbide Steel. However, the new product did not attract sales and sales of the old products dwindled.Carbide Steel successfully applied to wind up Ajax. The liquidator wishes to look at the directors' actions which led to the collapse of Ajax. Jason believes that he should not be liable for the Carbide contract. Ben believes that he should have been informed by Alan, the Managing Director as to the risks attached to the Carbide Steel contract. This was especially because Alan was the accountant who kept the books of the business. Discuss the liability of the directors.

iii) How would your answer to (ii) change if Jason did not attend the Board Meeting as he was away on a one-month cruise.