Question 3 "Solid Metals Ltd produces industrial metal containers for the brewing sector. There are three executive directors, Anna, the Finance Director, George, the Sales Director and Ellie, the Managing Director on the Solid Metals board. Three years ago, "Shiny Iron Limited' approached the board of Solid Metals Ltd' and offered to sell the company a plot of land adjoining the 'Solid Metals Ltd' factory in Holloway, London. Because of the then financial uncertainty and a large debt burden, the board rejected the proposal. Subsequently, Anna and George acquired the land for 450,000. The 'Solid Metals Ltd board now regrets its initial failure to acquire the property, which is back on the market at 550,000. The board has not been informed who owns the land. George, as Sales Director, has authorised development of a new client relationship management system intended to store details of clients electronically. He chose a little known IT software company to design to talk to a number of different developers. The original budgeted cost of 150,000 has now risen to 250,000 and the development is running a year late. 1. Identify and explain, by reference to statute and case law, any relevant directors duties that may be engaged by the activities of Anna, George and Ellie (20 marks); and 2. Identify possible remedies for the Company for the breach of such duties (10 marks). Total 30 marks Question 3 "Solid Metals Ltd produces industrial metal containers for the brewing sector. There are three executive directors, Anna, the Finance Director, George, the Sales Director and Ellie, the Managing Director on the Solid Metals board. Three years ago, "Shiny Iron Limited' approached the board of Solid Metals Ltd' and offered to sell the company a plot of land adjoining the 'Solid Metals Ltd' factory in Holloway, London. Because of the then financial uncertainty and a large debt burden, the board rejected the proposal. Subsequently, Anna and George acquired the land for 450,000. The 'Solid Metals Ltd board now regrets its initial failure to acquire the property, which is back on the market at 550,000. The board has not been informed who owns the land. George, as Sales Director, has authorised development of a new client relationship management system intended to store details of clients electronically. He chose a little known IT software company to design to talk to a number of different developers. The original budgeted cost of 150,000 has now risen to 250,000 and the development is running a year late. 1. Identify and explain, by reference to statute and case law, any relevant directors duties that may be engaged by the activities of Anna, George and Ellie (20 marks); and 2. Identify possible remedies for the Company for the breach of such duties (10 marks). Total 30 marks
