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Josh decides to set up a new business and purchases an ‘off-the-shelf company to do so (named XYZ Ltd). There are five other shareholders involved in the business. The day after purchasing the company, he negotiates the terms of a contract to lease a small area in an office. The parties to the contract are XYZ Ltd and the lessor. A few days later, Josh changes the name of the company to Too Good Ltd and receives the company’s certificate of incorporation. The contract is then signed, but Josh forgets to amend the name of company from XYZ Ltd to Too Good Ltd.
Can Too Good Ltd ratify the contract?
Textbook answer is “yes”. Please help me on this as I believe both at the time of signing the contract with the leasor and negotiation, the name of “Too Good Ltd” was not mentioned. Thank a lot, sir Mike!
Hi
Here is Section 81 of Companies Act 2006:
81
Change of name: effect
(1)A change of a company’s name has effect from the date on which the new certificate of incorporation is issued.(2)The change does not affect any rights or obligations of the company or render defective any legal proceedings by or against it.
(3)Any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.
However, let me remind you that there is NO NEED FOR YOU TO KNOW or learn case names, section numbers, titles of Acts and so on. I have merely quoted the Act and Section number to show you the authority behind the printed solution 🙂
OK?
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