company law problem questionWatch this thread
social media, corporate promotions and other media-related fields. The directors are
Amy, Ben, Conor, Daisy and Emma.
On behalf of TurningArt Plc, the directors signed a lease for new production studios
with Big Block Ltd in February 2021. However, the rent was far in excess of the market
rate. The transaction was entered into mainly based on Emma’s recommendation, and
the other directors did not seek any professional advice on the rental value of the
studios before signing the lease. In February 2022, the directors found out that Emma
is a shareholder in Big Block Ltd.
In October 2021, Ben was contacted by Proxy Ltd, a new television network, about an
idea to develop a mini-series based on love stories in the time of Corona. Proxy Ltd
was a relatively new network and was very keen to work with an established company
like TurningArt plc. So, during the negotiations, Proxy Ltd offered TurningArt Plc a
substantial up-front fee instead of a fee based on its rating success after the series
aired, which was the usual arrangement in the industry at the time. Ben presented this
idea to his fellow directors at a board meeting as a venture that is unlikely to be
successful, and he also did not mention the up-front fee. Based on Ben’s advice. The
board decided not to pursue this opportunity. Ben then resigned from TurningArt Plc
and is developing the mini-series with Proxy Ltd under his new company, Blues Ltd.
Advise the directors on any potential liabilities for their actions
But it’s a typical director duties question-s172 onwards.