Section B - Scenario 4
SCENARIO: 'BioSynth Plc' is a synthetic biology firm. Dr. Aris is a director. BioSynth is approached by an investor offering a lucrative contract to develop a new enzyme. The board of BioSynth declines the contract because the company lacks the specific lab equipment required. Dr. Aris, seeing the potential, resigns from BioSynth and sets up his own private company, 'ArisEnzymes Ltd', which buys the equipment and takes the contract for itself, making a £500,000 profit.
QUESTION: Which specific statutory duty under the Companies Act 2006 has Dr. Aris most likely breached?
ACCA · Question 56 · Management, administration and the regulation of companies
Section B - Scenario 4
SCENARIO: 'BioSynth Plc' is a synthetic biology firm. Dr. Aris is a director. BioSynth is approached by an investor offering a lucrative contract to develop a new enzyme. The board of BioSynth declines the contract because the company lacks the specific lab equipment required. Dr. Aris, seeing the potential, resigns from BioSynth and sets up his own private company, 'ArisEnzymes Ltd', which buys the equipment and takes the contract for itself, making a £500,000 profit.
QUESTION: Dr. Aris argues that he is not liable because he resigned before taking the contract. Is this a valid defense?
Answer options:
Yes, resignation immediately terminates all directors' duties.
Yes, because the company had already formally rejected the contract.
No, the duty to avoid conflicts of interest regarding the exploitation of property, information, or opportunity continues after resignation.
No, but only if his employment contract contained a non-compete clause.
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