Subject: Malaysia Company Law

Question 1:

Jaya Plus Bhd is a company involved in the construction industry. Three out of its five directors are qualified accountants and full-time employees of the company.

The directors had caused the company to invest in Success Bhd. The decision was made based on the fact that Success Bhd was making a massive profit from the sales of face masks and hand sanitizers during the imposition of the Movement Control Order (MCO) by the government of Malaysia due to the outbreak of novel coronavirus disease (COVID-19). However, the Success Bhd suffered a heavy loss after the government of Malaysia has ended the MCO. Consequently, the Jaya Plus Bhd did not get a promising return from the investment made in Success Bhd.

Advise whether the directors have breached their duties.