Use This Fact Situation to Answer the Related Questions That

question 17

Multiple Choice

Use this fact situation to answer the related questions that follow. Jane is the director of a private national company and has a number of friends who are the directors or officers of other large private national companies.One weekend,Jane and her family are invited to a barbecue at the home of Jane's good friend Edmund,who casually tells Jane as her friend that his company is about to sell a number of franchises and that anyone can pick them up relatively cheap.
In the situation above,if Jane decides to buy one or more of the franchises and the company finds out what she has done and sues her,it will probably argue that

• A)Jane breached her duty of care owed to the company.
• B)Jane breached her duty of good faith owed to the company.
• C)Jane had an undisclosed interest in Edmund's corporation.
• D)Jane came into the information in her capacity as a director of the company.
• E)none of the above

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Definitions:

Common Law

A body of laws based on judicial decisions and customs, rather than statutory laws passed by a legislature.

Adequate Consideration

A fair and reasonable value exchanged in a contract, ensuring that all parties receive something of value.

Arbitration Clause

A provision in a contract that requires the parties to resolve disputes through arbitration rather than through litigation in court.

Preexisting Duty

An obligation that a party is already legally bound to, which cannot serve as consideration for a new contract.