Question 4: BCJA Pty Ltd has three directors, Bev, Christopher and Jonathan, who are also the shareholders. The company is in the business of providing tours of places of interest to the public in Melbourne. Bev is the managing director of the company. Bev also looks after the administration matters of the company. To expand the business, the company needed a loan of $150,000 to acquire new vehicles and office space and computers. Bev approached the National Australia Bank Ltd for a loan. The constitution states that the managing director can only obtain a loan up to $100,000 and any amounts above that must be approved by the shareholders. The Bank was happy to lend the money to the company as they had been the bankers for the company for a long time and there was adequate security for the loan. The documents for the loan were signed by Bev. The funds were deposited in to the company's bank account 2 days later. Christopher who was recently married was building his new home and was short of funds. He therefore "borrowed" the funds from the company to pay for his new home. The bank manager at the National Australia Bank Ltd knew that Christopher was building a new house and was looking for additional funds to complete the house. Bev and Jonathan found out about this and fired Christopher and removed him as a director. As the remaining directors of the company they refuse to pay for the loan as they did not get the money. You are the accountants for BCJA Pty Ltd. Advise whether the company is liable to repay the $150,000 to the National Australia Bank Ltd. Please refer to relevant case law or legislation where appropriate