The general rule says, company has approved or endorsed an act or contract that has been done or made except prior authorization. (PRBL Week 5 2015)
As Karen and Jones were two legal directors so they were legal authority by law to take decisions. They thought it would be a good expansion opportunity for Delish and took the loan. So Karen and Jones contracting with bank get legal. And they are being company representatives so it is Delish’s duty to repay to the bank.
So being two legal directors Karen and Jones are proper authority to take part in loan agreement with bank. So we can wrap up saying these two directors dealing with bank about the loan was legally authorised.
According to Section 127(1) & (2), says a document can be properly executed with or without using any common seal if it is signed by two directors (Corporations Act 2001).
The other three claims that the loan agreement was not properly executed as they did not approved the expansion plan but co-signing of Karen and Jones makes the loan agreement legal as they are legal directors. Here it is not mentioned that whether or not Karen and Jones used the common seal of company to get the loan. But with or without the common seal the document is still duly executed as bank can assume …show more content…
He did this to help his friend’s company Rapacity to get the contract who was in difficulties. Though Turner refused to take any personal benefit for transferring the contract still it is a clear violation of duty of good faith as we can see there is nothing which can promote Turner’s decision to be good for Delish. As a managing director of the company Turner should have though for the best interest of his own company rather than his friend’s. No reasonable director would have considered it to be in the best interests of the corporations so it is the breach of good faith (ASIC v Adler
As Karen and Jones were two legal directors so they were legal authority by law to take decisions. They thought it would be a good expansion opportunity for Delish and took the loan. So Karen and Jones contracting with bank get legal. And they are being company representatives so it is Delish’s duty to repay to the bank.
So being two legal directors Karen and Jones are proper authority to take part in loan agreement with bank. So we can wrap up saying these two directors dealing with bank about the loan was legally authorised.
According to Section 127(1) & (2), says a document can be properly executed with or without using any common seal if it is signed by two directors (Corporations Act 2001).
The other three claims that the loan agreement was not properly executed as they did not approved the expansion plan but co-signing of Karen and Jones makes the loan agreement legal as they are legal directors. Here it is not mentioned that whether or not Karen and Jones used the common seal of company to get the loan. But with or without the common seal the document is still duly executed as bank can assume …show more content…
He did this to help his friend’s company Rapacity to get the contract who was in difficulties. Though Turner refused to take any personal benefit for transferring the contract still it is a clear violation of duty of good faith as we can see there is nothing which can promote Turner’s decision to be good for Delish. As a managing director of the company Turner should have though for the best interest of his own company rather than his friend’s. No reasonable director would have considered it to be in the best interests of the corporations so it is the breach of good faith (ASIC v Adler