Company Law Quiz: Directors and Their Duties

Which of the following is NOT a disqualification for a director under CA 2016?

• Convicted under specific sections of CA 2016

• Over 70 years old

• Convicted of fraud

• Undischarged bankrupt

What is the primary duty of a director as per S.213(1) CA 2016?

• To maximize personal profits

• To ensure company shares are sold

• To exercise powers for a proper purpose and in good faith

• To avoid any form of conflict

What must a director do if they have an interest in a contract?

• Resign immediately

• Ignore the interest

• Disclose the nature of their interest

• Vote on the contract

Which case established the subjective duty of care for directors?

• Kawin Industrial v Tay Tiong Song

• Daniels v Anderson

• Re City Equitable Fire Insurance

• Guth v Loft

What is the consequence of a director breaching their fiduciary duty?

• Voidable contracts and damages

• Immediate resignation

• No consequences

• Increased salary

What does the Business Judgment Rule protect directors from?

• Criminal charges

• Liability for decisions made in good faith

• All forms of liability

• Personal lawsuits

Which of the following is a requirement for a director to rely on information from others?

• They must not disclose any interest

• They must follow all advice given

• They must have prior experience

• They must assess the information independently

What is the role of a nominee director?

• To act solely for personal gain

• To manage the company independently

• To act on behalf of another person while prioritizing the company's interests

• To oversee all financial transactions

What happens if a director fails to disclose their interest in a contract?

• The contract is automatically valid

• The company must pay a fine

• The contract is voidable at the company's option

• The director is rewarded

Which of the following is true regarding the no profit rule?

• Directors must report any profits earned through their position

• Directors can keep all profits made

• Directors can only profit from trade secrets

• Directors are exempt from reporting profits