Directors in breach for trying to direct business to new company

The High Court has found that a company director was in breach of his obligations to the company when he attempted to divert business to a new company he was establishing and also attempted to steal employees away to the new business by giving false information to the employees that the original company was closing down. 

As well as the director, registered on the Companies Office register as the director, the Court also held that other investors were de facto directors of the company. They were also in breach of their obligations as directors by attempting to divert business to the new company they were setting up.

The three directors were held to have conspired to appropriate staff, clients and business opportunities for their own interests.  They were each ordered to pay the original company $681,000 in damages for the loss in re-establishing the company’s business and lost opportunities.

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