Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Yes
Was the contract ratified by the principal?
Occurs when the coy led the counterpart to
believe, through some representation, whether
Was there Ostensible/Apparent Authority?
by words or conduct, that the agent was duly
authorised to act on principals behalf Although the agent does not have actual authority, the principal may still be bound by the agents acts if
the agent had apparent authority. As per Freeman & Lockyer v Buckhurst Park Properties Ltd, for
apparent authority to arise, the third party must show that he relied on a representation (that the agent
Coy NOT bound by contract has authority) made by a person with actual authority.
It prevents a 3P from being put on notice: Even where the 3P does have notice of the restriction, he will often still be able to enforce
(1) Where there is a constitutional limit on the the contract against the coy via the application of either 25N or the IMR.
agents power subject to compliance with an
[CA] S25B 25D
internal procedure and the agent was aware
S25B: Power of directors to bind coy
of it
[Common law] Indoor Management Rule (IMR)
(e.g. coy requires 2 directors to sign a
contact) The rule provides that Counterparties dealing with coy is entitled to assume that all
OR matters of internal management procedures required by the constitution have been
(2) That the 3P was entitled to presume that complied with in absence of facts putting in on inquiry (Royal British Bank v Turquand)
the persons had been duly appointed to office
in conformity with the constitution.
The third party is not deemed to have notice of the restrictions on the agents authority in
the M&A since s 25A states that there is no constructive notice of the contents of the
M&A.
Yes
Coy bound by contract
IMR does not apply where the 3P has constructive /actual knowledge of the
irregularity
(1) Where the contracting party is an insider
(2) Constitution simply excludes the authority to enter that cannot be cured by any
No, 3P cannot rely on IMR
internal process
(3) Contracting part put on inquiry as to agents lack of authority and not restriction
of internal procee