Company Law Case Study

Whether is director individual liable or company personal liable or not?

For the case, there are three directors and one general manager in the company when the company was going to winding up, one director of managing who is Fred and the manager and the general manager who is Mr. Chin Chai bought raw material from Besi Sdn Bhd, it worth 2 million, after a period time, the Froddo company was bankrupt, so who was undertake the liability for the 2 million?

Who is going to be sued?

When the company was bankrupted with 2 million debt to creditors, creditor wanted to get their money backed, but the company didn’t have enough money to return to creditors, so the creditor would sue the company, at that time, there were three directors control the company and one general manager, if the creditors sue the company, then the three directors would undertake that 2 million liability, but two of directors would not agree this situation, because the 2 million debt was not their done, it didn’t any relation to them, the debt were belong to the managing director Fred and the general manager, they did this deal without their agree and didn’t any discuss with another two directors , so the two directors would require the court took this order back, they required the court sued the managing director and the general manager director that undertake the 2 million debt, they took this action in order to protect themselves rights and benefit, they would use the separate action against the managing director Fred and the general manager of the company that was lift the company veil, the law could directly sue them separated the company. So the Fred who was managing director and the general manager Chin Chai would be sued by the creditor. Firstly, the liquidator the company, the company has three directors that have to undertake the liability, the other two director didn’t agree, the two directors put another aside, can lift the corporation veil, then the managing director Fred has to be...