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ACCA Applied Skills · Corporate and Business Law (Global) · Other company officers

Harlow Inc's board has told its secretary, Priya, that she may negotiate and sign all contracts for office cleaning and stationery up to a stated limit. She signs a stationery contract within the limit. What is the nature of her authority for this contract?

Priya acts with actual express authority because the board specifically told her she could sign these contracts within a limit. Ratification is unnecessary since the authority existed before she acted, and it does not come from statute but from the board's instruction.

  1. AActual express authority given by the boardCorrect
  2. BAuthority by ratification only after signing
  3. CAuthority arising solely from statute

Explanation

The board expressly authorised her to sign such contracts within a limit, which is actual express authority. Ratification is not needed because the act was authorised in advance. No statute gives this specific power to the secretary.

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