The Nine Nine Ltd NN Ltd is an event organising company that specialises in themed public and private events, such as murder mysteries, bank heist and escape room themed nights. The directors are Jake (the non-executive chairman), Raymond (the CEO), Hitchcock and Scully (two more non-executive directors). The company has run into some financial difficulties as the market for these events inexplicably declines. The audit committee has warned the board that the company is doing it tough and at a tipping point. At Raymonds suggestion, the company investigates the possibility of purchasing Wunch Ltd, a rival operator. Raymond holds a 20% shareholding in Wunch Ltd.

The purchase is an agenda item at the September board meeting. Hitchcock is unable to attend as he has had a nasty case of food poisoning from eating a tainted potato chip. By the time the meeting reaches the purchase agenda item they have already been meeting for 6 hours without a break. Several of the directors are ready to break for the promised heist re-enactment that they hold annually for the board and their families. Jake only allows 10 minutes for Raymond to present the purchase proposal to the board. A financial report on the proposal is tabled but not read or discussed. It would seem that one of the driving forces behind the decision to buyout Wunch limited is Raymonds life partner, Kevin. Kevin is neither a director, nor employed at the company, but is a highly charismatic person who is often able to persuade Raymond and Jake on business matters.

In an effort to support the companys declining share price, Raymond agrees to lend $10m of NN Ltds money to Jakes family company, The Title of Your Mix Tape Pty Ltd, to purchase NN Ltds shares on the open market. He suspects that the investment committee will not approve the loan so he doesnt tell them about it. Appropriate documentation is prepared but he doesnt require The Title of Your Mix Tape Pty Ltd to provide any security.

Assume that:

• The purchase of Wunch Ltd is completed; and
• It proves to be a total financial disaster.

Please consider whether any of the directors have breached any of the directors duties you have learned about during the course (excluding section 588G and s181). Consider appropriate remedies should any of the directors be found liable for a breach of their duties.

ILAC Method

1. Is X person a director or officer of the company? ( for each of the directors; Jake, Raymond, Scully, Hitchcock and Kevin)

Law and Application:

Conclusion:

2. What directors duties (if any) has x breached?

Law and Application:

Conclusion:

3. Remedies

Notes: In this first template, you would insert reference to the various directors (some of which will have slightly different considerations) as you go. Note any conclusion should be very brief.