Answer to Question #148608 in Law for divya

Question

Sara is a director but never takes much interest in the company she directs. The company appears now to be insolvent and indeed insolvent for some time. What is Sara’s liability under company law?

Answer 1

      Directors of companies are entitled to perform their assigned responsibilities and duties with care and honesty. Sarah's liability involves a failure in the duties' performance, which is also described as negligence of duty because lacking interest towards a company leads to performing duties carelessly, as dishonesty develops, which contributes to the negligence of duty.