Obligation Under Aforesaid Sections Of Act â€Myassignmenthelp.Com

Question: Discuss About The Obligation Under Aforesaid Sections Of Act? Answer: Introducation The Australian Corporation Act, 2001 states, under section 124 that a corporation is given the same legal capacity as that of an individual which is inclusive of the power to form a valid contract. Section 125 provides that such agreement which has been entered into by any suchoperations must perform the promised act even if it is beyond the companies constitution. Since both Michell and Tim are authorized authorities under the company they can form a valid contract which has to be performed on behalf of the company being an obligation under the aforesaid sections of the act. Section 126 of the act states, since a company cannot act on its own it has to take decision through an agent. The agent on its behalf is authorized to make, ratify or discharge a contract. Here, Michell and Tim are the authorized authorities who are supposed to act as agents on behalf of the company. Under the Corportation Act, 2001, section 126 states, that a company cannot take decisions on its own and thus should acts through agents or representatives. The agents/ representatives are empowered on behalf of the company to marketing, ratify or discharge the contract in which they have entered or about to enter. Here, George intends to sell out his cake shop to Gerard and Sylvia. Under the provisions of section 127, the management to sell the shop will satisfy only if one director and one secretary provides consent to such agreement. Though Gerard is the nominated director he can consent, Sylvia is just a shareholder of the company. She is not the secretary to provide consent which is necessary to satisfy the requirements under section 127. Again, section 126 tells us that if any authorized agent provides consent on behalf of the company to any such document to form an agreement, then such agreement shall be binding upon both the parties to a contract and should be treated the same way if one director and one secretary would have given consent. Though Sylvia is not the secretary, she is authorized under the company as an agent/ representative to undertake contracts. Thus her consent to such document will satisfy the requirement under section 127 and makes the contract binding References Business-law, L, (2016), Australian Corporations Legislation. Bevan, (2016). Corporation Law 8th Edition. Thomson Reuters.