GV Milk Pty Ltd is a company which sells milk products in Gippsland, Victoria. GV Milk was started by Jill, Lizette, Allan and Kerry they are all directors and each own shares. They were all dairy farmers who owned neighbouring dairy farms before starting GV Milk. They figured that it would be more profitable to sell other peoples dairy products than to only sell their own. They agreed to pool their talents and sell their respective farms to raise the capital for GV Milk. GV Milk has been very successful since its formation.

Kerry has decided to run for the position of President of the United Dairyfarmers of Victoria. This annoys the other directors, as they believe that if he wins he will have no time to focus on the operation of GV Milk. At a shareholders meeting of GV Milk held in May a resolution is passed voting Kerry off the board. Kerry is furious and demands that he be reinstated. His demand is ignored.

The remaining directors have discovered that the fat left over from the milkmaking process is perfect for making a very popular type of cheese. Up until recently the company has been discarding the fat as a waste product. Seeing the potential to make money from the fat, Jill, Lizette and Allan start a company called GV Cheese Pty Ltd They are all appointed as directors and they each own one share. GV Cheese uses the waste fat from GV Milks operations and turns it into cheese using GV Milks equipment and employees. The cheese business is very profitable.

Have the directors breached any of their duties in connection with the GV Cheese operation?