Skip to content

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

Hartwell Inc's company secretary, Mei, signed a contract with a hotel to hire rooms and a conference hall for the company's annual general meeting. Hartwell refuses to pay, arguing that Mei had no authority. Which is the most likely outcome?

Hartwell is likely bound. Arranging the venue for a general meeting is an administrative matter that falls within the company secretary's apparent authority, so the hotel can enforce the contract without proof of express board approval or member resolution.

  1. AHartwell is bound, because arranging a meeting is an administrative matter within the secretary's apparent authorityCorrect
  2. BHartwell is not bound, because only directors can ever enter any contract for the company
  3. CHartwell is bound only if the members approved the hotel booking by ordinary resolution beforehand

Explanation

Organising company meetings is a core administrative duty of the secretary. A third party can rely on the secretary's apparent authority for such matters. The claim that only directors can contract is wrong, and no member approval is required for routine administrative arrangements.

Did you get it right without looking?

One question tells you little. A timed set on Other company officers shows your real accuracy, how long you take and where you lose marks.

Practise Other company officersFree diagnostic mock

More Other company officers questions