Peter is bankrupt and therefore cannot act as a director ofa company. Nevertheless he does so. Bruce is the managing director ofthe sam company. Bruce gives Peter a letter addressed to the other party to the contract saying that that Peter has authority to enter into a contract. Bruce, however, privately tells Peterthat he is only to negotiate the contract, but is not to enter into it. Nevertheless, Peter signs the contract as agent ofthe company.
a. Is the company bound? Give your reasons.
b. Would it make any difference to your answer if Bruce is only acting as managing director, never having been appointed to the position? If so, what is the difference? Explain it.
c. Would it make any difference to either of your answers if Peter had written the name ofthe company and signed as one director,forging Bruce’s signature as the other director? If so, what is the difference? Explain it.
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