Question (1a) The duties of directors are to act within their powers, to promote the success of the company and to avoid conflicts of interest . Tracey had broken her contract as director of the company. Under the Companies Act (CA) 2006, this Act gives directors' duties a legal basis, although there are common law rules which we can also refer to and further guidance can be obtained via the jurisprudence. The duties of directors are enforceable in the same way as any other fiduciary duty owed to a company by its directors and the remedies available may include: damages or compensation where the company has suffered a loss; restoration of company property; an account of the profits made by the director; and the termination of a contract where the director has failed to disclose an interest. It should be noted that the above does not apply to the duty to exercise reasonable care, skill and diligence under section 174, which is not considered to relate to the relationship between a trustee and the person or organization for whom the trustee acts. duty. Section 175 of the Act specifically addresses the duty to avoid conflicts of interest. The article specifies that a conflict of interest may, in particular, arise when a director makes personal use of information, property or opportunities belonging to the company. Directors have the ability to approve a conflict of interest under section 175, and this preserves the ability of members of a company to authorize conflicts that would otherwise constitute a breach of this duty. Applying the rules to the facts of the problematic scenario, it can be seen that Des breached his legal duty under section 175 of the CA 2006 by allowing a conflict of interest to arise without declaring it to the board and without obtaining the approval of the other directors or indeed, the m...... middle of paper ......start-up or if the company will have significant debts.BibliographyBusiness Gateway: Legal structures: the basics, 2014, Business Gateway: Legal Structures: The Basics, [ONLINE] Available at: http://www.bgateway.com/starting-up/form-a-company-or-business/legal-structures-the-basics/ #page-1291 [Accessed April 4, 2014] Choose a structure for a new business, GOV.UK. 2014. Choose a legal structure for a new business, GOV.UK. [ONLINE] Available at: https://www.gov.uk/business-legal-structures/limited-company [Accessed 4 April 2014]Ewan McKendrick, 2011, Contract Law (Palgrave Macmillan Law Masters), 9th revised edition , Palgrave MacmillanKaplan, 2011, ACCA Complete Study Text: F4 Corporate and Business Law CL (Eng) Edition, Kaplan PublishingSarah Riches, 2013, Keenan and Riches' Business Law Premium Pack, 11th revised edition, Pearson Education Limited