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S40 CA06 states that the power of the directors to bind the company, or to authorise another to bind the company, will not be limited by anything in the company’s constitution, provided the other party is acting in good faith. S40 goes on to state that even where there is actual knowledge of the lack of authority this is not enough to count as lack of good faith so, on the face of it, any contract entered into by the board of a company will be binding.
Can u plz give examples of above two situations .
Where the company’s articles specifically state that a particular director has no power to employ a new employee, and he does so, the new employee will be validly appointed because nothing in the constitution (the articles) cannot limit a director’s authority when dealing with a third party that acts in good faith
Even though the new employee may have known about the restriction in the articles, that’s not enough to show lack of good faith
So your conclusion is correct, except where you have written “any contract entered into by the board of a company will be binding” you need to change the word “board” to “any director”
OK?
Have you thought any more about suggestions for compensating me so that I could select one?
🙂
Yes I was thinking to pass the exams with flying colors ?
Or still asking u more and more questions
Or none of the aboveWhich one u choose
Note I couldn’t think any more options to express my gratitude
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