Which of the following is INCORRECT in relation to a director who accepts a bribe in return for selling the company’s business for a low price? Select one: a. The director has breached their statutory duties under ss 181 and 182 of the Corporations Act 2001 (Cth). b. The director may be found guilty of a criminal offence if they were intentionally dishonest. c. The director has breached their fiduciary duty to avoid a conflict of interest. d. The director will only be liable under the common law and under the Corporations Act 2001 (Cth) if they were intentionally dishonest and evidence establishing the directors’ dishonest intention must be put forward.
Question
Which of the following is INCORRECT in relation to a director who accepts a bribe in return for selling the company’s business for a low price?
Select one:
a. The director has breached their statutory duties under ss 181 and 182 of the Corporations Act 2001 (Cth).
b. The director may be found guilty of a criminal offence if they were intentionally dishonest.
c. The director has breached their fiduciary duty to avoid a conflict of interest.
d. The director will only be liable under the common law and under the Corporations Act 2001 (Cth) if they were intentionally dishonest and evidence establishing the directors’ dishonest intention must be put forward.
Solution
The incorrect statement in relation to a director who accepts a bribe in return for selling the company’s business for a low price is:
d. The director will only be liable under the common law and under the Corporations Act 2001 (Cth) if they were intentionally dishonest and evidence establishing the directors’ dishonest intention must be put forward.
This is incorrect because a director can be held liable for breaching their fiduciary duties and statutory duties under the Corporations Act 2001 (Cth) regardless of whether they were intentionally dishonest. The director's actions of accepting a bribe and selling the company's business for a low price already constitute a breach of these duties. The requirement of proving intentional dishonesty and providing evidence for the same is not a prerequisite for establishing liability under these circumstances.
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