A managing director was approached personally by a potential client who said it would not deal with his company. He resigned, claiming ill health, and took the contract himself. Following Industrial Development Consultants v Cooley, what was the position?

Correct answer: D) He was liable to account to the company for the profits, because he had used an opportunity that came to him while a director

Explanation

A director must not exploit any property, information or opportunity, and it is immaterial whether the company could have taken advantage of it, as now stated in s175(2). In IDC v Cooley the director obtained the information while a director and was liable to account for his profit despite resigning first; s170(2) extends the duty to former directors in respect of opportunities of which they became aware while directors.