Mantech Plc, a leading technology company in Manchester, specialises in developing cutting-edge electronic devices and software solutions. Their latest creation, the M-Genius, is marketed as a revolutionary artificial intelligence (AI) system designed to assist individuals with daily tasks. The M-Genius utilises advanced algorithms and machine learning capabilities, making it highly sought after in the market.

ManTech launches the M-Genius in the market, but within weeks of purchase numerous customers report serious malfunctions. ManTech discovers that the malfunctioning of M-Genius resulted from a design flaw introduced during the manufacturing process. The company's internal investigation reveals that, Adam and Eve, two of its managing directors, had outsourced one part of the product's code to ChattyCode Ltd., a well-regarded software programming company. However, they had done so without consulting and obtaining the approval of ManTech's board of directors. ChattyCode are to be paid 1m under the contract they signed with Adam and Eve acting on behalf of ManTech. The design flaw was a direct result of a problem in ChattyCode's code. Also, under ManTech's articles of association, no individual director is authorised to award contracts for over 800,000 to third parties without the board of directors' prior approval.

Advise ManTech on whether they are bound by the contract with ChattyCode so as to pay 1m to them, and on the potential liability of Adam and Eve as directors. How would your answer be affected if the sole shareholder and director of ChattyCode is Eve's husband, Abraham? uk case laws in text citation