Andrew Young, founder and director of whitegoods distributor Kleenmaid, has a problem. His company has fallen into administration with debts of over $96 million including $26 million in customer deposits that have been paid for appliances not yet delivered.
Andrew knew that Kleenmaid was not able to repay its debts for some time. In an attempt to save the company he arranged for the company to borrow over $4 million to help cover the company's existing financial obligations.  Now that Kleenmaid has fallen into administration, Andrew is concerned that he and the other company directors may have breached their directors' duties.

1. Advise Andrew if he has breached a directors' duty by borrowing the additional money

Answer rating: 100% (QA)

In many jurisdictions directors have a fiduciary duty to act in the best interests of the c... View the full answer