Regal Pty Ltd ('Regal') operates a hotel on the shores of Pearly Bay, a coastal resort in Victoria.Harry and Meghan are the directors of Regal.The hotel has been struggling financially for some years, but now the increased presence of sharks in the ocean has caused the hotel to lose many bookings.On 1 May 2019 the directors of Regal realised that it cannot pay its debts.

Despite the poor financial position of Regal, Meghan signed a contract on behalf of Regal to re-fit the hotel on 15 May and Harry paid out Lee, one of Regal's suppliers (who he plays golf with) in full on 1 June 2019, ahead of the other suppliers.

Cash flow does not improve - and the court approved an application to wind up Regal on 1 July 2019.The court appointed a liquidator, Ms Gimlet on 1 August 2019.

a)Advise Ms Gimlet of the date of insolvency and whether she can recover any money from Lee.

b)Advise Ms Gimlet as to whether Harry and Meghan have breached any of their duties as directors and what defences may be available to them.