Section 49: Liabilities arising from contravention of section 47.

(1) An arrangement entered into by a public enterprise in contravention of section 47 of this Act and any transaction entered into in pursuance of the arrangement, whether by the public enterprise, or any other person, shall be avoidable at the instance of the public enterprise or the Commission, unless one or more of the conditions specified in subsection (2) of this section is satisfied.
(2) The conditions referred to in subsection (1) of this section are that -
(a) restitution of any money or other asset which is the subject matter of the arrangement or transaction is no longer possible or the public enterprise has been indemnified in pursuance of this section by any other person for the loss or damage suffered by it; or
(b) any right acquired bona fide for value and without actual notice of the contravention by a person who is a party to the arrangement or transaction would be affected by its avoidance; or
(c) the arrangement is, within a reasonable period, affirmed by the Commission.
(3) Subject to subsections (5) and (6) of this section, if a director of a public enterprise or a person connected with him enters into an arrangement with a public enterprise in contravention of section 47 of this Act, the director and the person so connected, and any other director of the public enterprise who authorised the arrangement or any other transaction entered into in pursuance of the arrangement, is guilty of an offence and liable on conviction -
(a) to account to the public enterprise for any gain which he has made directly by the arrangement or transaction; and
(b) jointly and severally, with any other person liable under this subsection, to indemnify the public enterprise for any loss or damage resulting from the arrangement or transaction.
(4) Subject to subsections (5) and (6) of this section, subsection (3) of this section is without prejudice to any liability imposed otherwise than by that subsection and liability under that subsection arises whether or not the arrangement or transaction entered into has been avoided in pursuance of subsection (1) of this section.
(5) A director who enters into an arrangement in contravention of section 47 of this Act is not liable under subsection (3) of this section if he proves that he took all reasonable steps to secure that the public enterprise complied with that section.
(6) A person so connected with a director and any such other director as is mentioned in subsection (3) of this Act, is not liable under that subsection if he shows that at the time the arrangement was entered into, he did not know the relevant circumstances constituting the contravention.
(7) In this section and in section 47 of this Act, a person is connected with a director of a public enterprise if, not being himself a director of the public enterprise, he is -
(a) the spouse, child, step-child, father, step-father, mother, step-mother, sister, brother or agent of the director;
(b) except where the context otherwise requires, a body corporate with which the director is associated; or
(c) a person acting in his capacity as trustee of any trust -
(i) the beneficiaries of which include the director, his spouse, child or step-child, or a body corporate with which he is associated, or
(ii) whose terms confer a power on the trustees that may be exercised for the benefit of the director, his spouse, child or step-child, or a body corporate with which he is associated; or
(d) a person acting in his capacity as partner of that director or of any person who, by virtue of paragraphs (a), (b) or (c) of this subsection, is connected with that director.