Hi,

I would cast this as more of a contacts question than purely ethics. I would expect to be ethically bound to honor the contract, as long as the contract remains in force. I would question whether the contract is still in force if the other party is no longer in business (however if the business was sold, the contractual agreement would likely convey to the new owner). There should be a way to exercise due diligence and make a reasonable effort to exhaust all possibilities of contacting the previous owner for permission. Of course none of those follow up activities are given, so B is probably still the best answer to pick from. This is a good teaching moment to stress covering this case in the contract, since it has a reasonable probability to occur.

Although not related to PM, here is a question I actually had to answer on a medical form prior to getting a physical for work in a high altitude climate.

"Do you wake up with head aches after a night of heavy drinking?" Yes/no (no essays allowed)
I guess I could have left it blank, which may be what I did.

This is along the same lines as the hypothetical twister "Are you still beating your wife?".

Although the PM sample questions have 4 possible answers, some of them seem to corner you in the same way.

-Bob

Is that the answer the PMP wants to hear as once the company is gone, it no longer legally exists. That is like saying that you are cheating on your wife if you remarry after she is dead.

Question:

You managed a website development project for a customer in the past and you signed an agreement with that customer. According to the agreement, you cannot undertake a similar project for any competitor for three years without the formal written approval of your past customer. Two years have passed and you have received an offer from a competitor to do a similar project for them. When you tried to obtain the approval from your previous customer regarding this, you discovered that your previous customer had closed his business and moved to another country. What should you do now?

A. Accept the offer as your previous customer has closed his business and moved to another country
B. Refuse the offer as you are still bound not to undertake such projects for one more year
C.Disclose this information to your new potential customer and seek his approval
D. Speak to legal counsel for guidance

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Hint: What is your ethical obligation?

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Answer and Explanation:

The Correct Answer is B.

As per the PMI Code of Ethics and Professional Conduct you must bring violations of the code to the attention of PMI. However you should get the facts together and gather evidence before attempting to contact PMI.