Corporate Authority Dealings With Officers

Corporate Authority Dealings With Officers

Free Samples

Corporate Authority Dealings With Officers

.cms-body-content table{width:100%!important;} #subhidecontent{ position: relative;
overflow-x: auto;
width: 100%;}

Corporate Authority Dealings With Officers

0 Download7 Pages / 1,528 Words


Discuss About The Corporate Authority Dealings With Officers?


Although a company is a legal person[1], it is an entity that is abstract in form and its capacity to contract can only be through natural persons’ actions.[2] By virtue of section 126 of the Corporations Act[3], a company possesses the power to enter into contracts through the agency of persons who are acting upon either the implied or express authority of the company. Accounting, contracts are only binding upon a company if they are entered into by agents who have the company’s authority. Normally, parties to such contracts would seek to escape from liabilities that arise from the same. Therefore, it is important to establish that the persons acting as agents have ostensible or actual authority from the company for the contracts to be binding. The organic theory of company law largely governs these kinds of scenarios, which lie beyond the ambit of agency law. However, they draw from agency law.
Michelle and Tim both sign a contract for the purchase of a motorbike with Michelle as director and Tim as company secretary. Michelle wants to opt out of the contract. The issue is whether the contract is binding upon Motorbikes Pty Limited.
In most of the companies with multiple directors, the companies’ constitutions will confer upon the board of directors (collectively) with management powers. The actions of a single director with outsiders will usually not be binding on the company as he lacks implied actual authority.[4] By virtue of a mandatory rule contained in section 198E (1) of the Corporations Act, a proprietary company that has a single director or shareholder is conferred with all of that company’s powers. The company’s constitution can limit such sole director’s actual authority where he is not the sole shareholder. This actual authority is lessened despite the wide powers conferred by section 198A. However, the individual director may possess implied authority to do what a sole director normally does in such a situation. The result is that the implied authority of such a sole director may be wider than their actual authority.[5]  
The authoritative pronunciation in the Panorama Developments case was that company secretaries are not merely clerks any longer but are considered to be companies’ officers with extensive responsibilities and duties.[6] In that case, “chief administrative officer” was the new term that was used to refer to company secretaries. Their authority is implied and they can represent the company in certain matters such as entering into contracts involving internal administration but not management of the company’s daily business. In the celebrated case of Northside Developments Pty Ltd v Registrar-General, the Honourable Court held that the company secretary’s position is conferred with implied actual authority. Such authority is for countersigning the affixed seal of the company and witnessing the fixation of the common seal.
Motorbikes Pty Ltd is a proprietary company that has a single director, Michelle, who is the sole director, and a company secretary, Tim. The law confers upon Michelle as sole director all the powers of the company. Such power includes entering into contracts with outsiders. Tim, as company secretary, is also clothed with ample powers to sign contracts on behalf of the company under the law.
The contract signed by Michelle and Tim on behalf of Motorbikes Pty Ltd for the purchase of a Motorbike is therefore binding upon the company.  
Gerard, who is listed as the director of Cakes Pty Ltd, signs, witnesses and stamps with the company seal a contract to buy a cake shop from George. Sylvia is the other witness to this transaction. George wants to back out of the transaction and the issue is whether he is bound by the contract.
Section 129 (6) provides for the execution of documents with the company seal. It provides that an assumption may be made that a company duly executed a document if the common seal appears to have been affixed and the witnessing done according to the provisions of section 127 (2). This was the holding in the Belven case where the court held that the common seal must “appear to be fixed”.[7] For the assumption to be applicable, an outsider only needs to rely on the fact that the document was signed by the company officers. This was the holding in the MYT Engineering case.[8] In that case, the consent of the company was evidenced by the signature of the directors. In the case of re Efron’s Tie & Knitting Mills Pty Ltd[9] and in Mancini v Mancini[10], the Court held that a director of a company cannot attest to the taxation of a document in two different capacities. This holding as read with section 127 (2) requires two different directors to physically witness the signing of the seal. However, even where an outsider is aware that the company’s constitution was not complied with during the affixing of the seal, he can still make an assumption that the sealing was done accordingly.[11] This was the position in the celebrated deciding of Equiticorp Finance Ltd v Bank of New Zealand.[12]
With regard to the time of acknowledging an outsider’s knowledge, it is at the time he enters in the contract.[13]       
The general rule is that a Principal is not bound by a contract in which an agent without authority entered as such a contract is absolutely void.[14] The Corporations Act makes provision for outsiders who correctly identify the officers of a company but incorrectly attribute their authority to transact. Sections 129 (2) and (3) provide for statutory assumptions where an outsider may assume that company officers who hold out as such or who are identified from the public record, have the implied authority that the position carries and are duly appointed. Section 201M further provides that mere defective appointments do not invalidate the acts of company officers. For outsiders dealing with officers, sections 198A and 198C are replaceable rules that confer actual authority to those officers. The company constitution also has a similar effect. It is important to note that by virtue of the Common Law doctrine of Constructive Notice, an outsider is expected to have knowledge of the company’s constitution. The implication is that the outsider is deemed to have knowledge of any express limitations on the authority of company officers. Although this rule operated against outsiders dealing with companies, the rule in Turquand’s case provides outsiders acting in good faith with protections in presuming that a company acted within the powers of its constitution without inquiring into the internal management.[15] In some instances, even after reading the constitution of a company, it may not be apparent to an outsider whether an officer of a company operated within his authority. Section 127 (4) provides that section 127 does not limit the manner in which a company executes a document.  
The general rule is that where a director acts beyond the scope of the interests of the company, their authority of binding the company is affected.[16] The exception is where an outsider had knowledge of the fiduciary breach. Where an outsider knows the breach, then the effects of voidable contracts cannot be escaped even with assumptions of due execution.
Since the contract was signed by Gerard the director and witnessed by Sylvia who was neither the director nor company secretary, George ought to have had knowledge of this fact. Provided that Gerard signed and witnessed the contract and Sylvia also witnessed, she held out as a person in authority.
Hence, the contract is binding and George cannot opt out.
Belven Enterprises Pty Ltd v Lydham Pty Ltd (1996) 14 ACLC 1478
Brick and Pipe Industries Ltd v Occidental Life Nominees Pty Ltd (1991) 6 ACSR 464 at 476
Brick and Pipe Industries Ltd v Occidental Life Nominees Pty Ltd (1992) 10 ACLC 253
 Equiticorp Finance Ltd v Bank of New Zealand (1993) 11 ACLC 952
Mancini v Mancini (1999) 17 ACLC 1570
MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 17 ACLC 861, 864
National Australia Bank v Sparrow Green Pty Ltd (1999) 17 ACLC 1,665
Panorama Developments (Guildford) Ltd v Fidelis Furnishing Fabrics Ltd [1971] 2 QB 711
 Re Efron’s Tie & Knitting Mills Pty Ltd [1932] VLR 8, 23
Rolled Steel Products (Holdings) Ltd v British Steel Corporation [1986] 1 Ch 246
Royal British Bank v Turquand (1856) 6 E&B 327; 119 ER 886
Salomon v Salomon and Company
The Corporations Act 2001, (Cth) Australia
Books and Journals
Baxter, C ‘Ultra Vires and Agency Untwined’ (1970) vol. 28 Cambridge Law Journal 280
Ford H, Ford’s Principles of Corporations Law, 10th ed (Australia: Butterworths 2001)
Larelle Chapple and Phillip Lipton, Corporate Authority and Dealings with Officers and Agents, (Australia: CCH Australia Limited 2002)
[1] Salomon v Salomon and Company
[2] Larelle Chapple and Phillip Lipton, Corporate Authority and Dealings with Officers and Agents, (Australia: CCH Australia Limited 2002), p.1.  
[3] The Corporations Act 2001, (Cth) Australia.
[4] See Brick and Pipe Industries Ltd v Occidental Life Management Pty Ltd (1991) 6 ACSR 464 at 476.
[5] Ford H, Ford’s Principles of Corporations Law, 10th ed (Australia: Butterworths 2001), p.658.
[6] Panorama Developments (Guildford) Ltd v Fidelis Furnishing Fabrics Ltd [1971] 2 QB 711.
[7] Belven Enterprises Pty Ltd v Lydham Pty Ltd (1996) 14 ACLC 1478.
[8] MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 17 ACLC 861, 864.

Free Membership to World’s Largest Sample Bank

To View this & another 50000+ free samples. Please put
your valid email id.


Yes, alert me for offers and important updates


Download Sample Now

Earn back the money you have spent on the downloaded sample by uploading a unique assignment/study material/research material you have. After we assess the authenticity of the uploaded content, you will get 100% money back in your wallet within 7 days.

UploadUnique Document

DocumentUnder Evaluation

Get Moneyinto Your Wallet

Total 7 pages


*The content must not be available online or in our existing Database to qualify as

Cite This Work
To export a reference to this article please select a referencing stye below:


My Assignment Help. (2018). Corporate Authority Dealings With Officers. Retrieved from

“Corporate Authority Dealings With Officers.” My Assignment Help, 2018,

My Assignment Help (2018) Corporate Authority Dealings With Officers [Online]. Available from:[Accessed 19 December 2021].

My Assignment Help. ‘Corporate Authority Dealings With Officers’ (My Assignment Help, 2018) accessed 19 December 2021.

My Assignment Help. Corporate Authority Dealings With Officers [Internet]. My Assignment Help. 2018 [cited 19 December 2021]. Available from:

.close{position: absolute;right: 5px;z-index: 999;opacity: 1;color: #ff8b00;}


Thank you for your interest
The respective sample has been mail to your register email id


$20 Credited
successfully in your wallet.
* $5 to be used on order value more than $50. Valid for
only 1

Account created successfully!
We have sent login details on your registered email.


Password: is one of the noted service providers that deliver essay help. We provide tailored essay assistance to make sure that student gets online essay help exactly in the way they want it to be written. We at have built teams of consultants, who readily attend every query related to help me writing my essay. We provide essay writing help in forms of tips and steps in order o assist students with tough essay assignments.

Latest Business Law Samples

div#loaddata .card img {max-width: 100%;

BU1112 Business Law
Download :
0 | Pages :

Course Code: BU1112
University: James Cook University is not sponsored or endorsed by this college or university

Country: Australia

Part A
Whether Stella is considered as an employee of PRX?
The main difference between employee and independent contractor is stated below:
Employee entered into contract of service, but contractor entered into contract for services.
Employer exercise control over the employee but no control was exercised by employer on contractor. It is considered as traditional test which was developed in Zuijs v Wirth Bros(Zuijs…
Australia South Lake Management health finance management  University of New South Wales 

BSBWHS605 Develop Implement And Maintain WHS Management Systems
Download :
0 | Pages :

Course Code: BSBWHS605
University: Swinburne University Of Technology is not sponsored or endorsed by this college or university

Country: Australia

Work Health and Safety Management System (WHSMS) is a collection of plans, tools, activities and processes. List 3 of these plans, tools, activities or processes and explain what they are,
The means, nitty gritty beneath, can be utilized whether the arranging procedure is straightforward or complex. They are:
Evaluating the current word related to wellbeing and security status including the ‘administration framework’ Lussier, R. N…
Australia Brisbane Management Work Health and Safety Management System (WHSMS University of Brisbane MBA 

BUSN331 Business Law
Download :
0 | Pages :

Course Code: BUSN331
University: Centennial College is not sponsored or endorsed by this college or university

Country: Canada

In Alberta, the Residential Tenancies Act applies to all the people in this jurisdiction, who rent their space out (Alberta Queen’s Printer, 2016). Through this act, the rights and responsibilities of the landlords and tenants are brought forward (Landlord and Tenant, 2015).
Question 1
Before a tenant can move in the rented accommodation, the tenant and the landlord have to reach an agreement, with regards to the…
Australia Edmonton Humanities Management University of New South Wales Masters in Business Administration 

LA1040 Contract Law
Download :
0 | Pages :

Course Code: LA1040
University: University Of London is not sponsored or endorsed by this college or university

Country: United Kingdom

A contract is an agreement between the parties which is enforceable legally in the courts. There are several provisions of law which governs how the terms related to the contract would operate. A contract consists of a set of provisions which are known as contractual terms. The weightage of such terms are not equal as one term may have a more significant consequence as compared to the other in relation to their brea…
United Kingdom London Economics Management University of London 

TLAW202 Corporations Law
Download :
0 | Pages :

Course Code: TLAW202
University: Top Education Institute is not sponsored or endorsed by this college or university

Country: Australia

If any person wants to carry out his business in the form of a company, then, it is necessary that the registration or incorporation requirements of such country must be met. In Australia, the Corporation Act 2001 and the guidelines laid down by ASIC provides with the steps that must be accomplish in order to establish a corporate entity.  (Malbon & Bishop, 2006).
A company is of great significance as it is treated as a …


Our Essay Writing Service Features

Qualified Writers
Looming deadline? Get your paper done in 6 hours or less. Message via chat and we'll get onto it.
We care about the privacy of our clients and will never share your personal information with any third parties or persons.
Free Turnitin Report
A plagiarism report from Turnitin can be attached to your order to ensure your paper's originality.
Safe Payments
The further the deadline or the more pages you order, the lower the price! Affordability is in our DNA.
No Hidden Charges
We offer the lowest prices per page in the industry, with an average of $7 per page
24/7/365 Support
You can contact us any time of day and night with any questions; we'll always be happy to help you out.
$15.99 Plagiarism report
$15.99 Plagiarism report
$15.99 Plagiarism report
$15.99 Plagiarism report
$3.99 Outline
$21.99 Unlimited Revisions
Get all these features for $65.77 FREE
Do My Paper

Frequently Asked Questions About Our Essay Writing Service

Academic Paper Writing Service

Our essay writers will gladly help you with:

Business Plan
Presentation or Speech
Admission Essay
Case Study
Reflective Writing
Annotated Bibliography
Creative Writing
Term Paper
Article Review
Critical Thinking / Review
Research Paper
Thesis / Dissertation
Book / Movie Review
Book Reviews
Literature Review
Research Proposal
Editing and proofreading
Find Your Writer

Latest Feedback From Our Customers

Customer ID:  # 678224
Research Paper
Highly knowledgeable expert, reasonable price. Great at explaining hard concerts!
Writer: Raymond B.
Customer ID: # 619634
Essay (any type)
Helped me with bear and bull markets right before my exam! Fast teacher. Would work with Grace again.
Writer: Lilian G.
Customer ID: # 519731
Research Paper
If you are scanning reviews trying to find a great tutoring service, then scan no more. This service elite!
Writer: Grace P.
Customer ID: #499222
Essay (any type)
This writer is great, finished very fast and the essay was perfect. Writer goes out of her way to meet your assignment needs!
Writer: Amanda B.
Place an Order

Calculate the price of your order

You will get a personal manager and a discount.
We'll send you the first draft for approval by at
Total price:

Powered by

× WhatsApp Us