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EXECUTION OF COMPANY DOCUMENTS

LEGAL REFERENCING OF SECTION 127 IN MELBOURNE

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Execution of Documents by a Company

execution of company documents

Section 127 Corporations Act deals with the execution of documents by the company itself. It provides that a company may execute a document without using a common seal, if the document is signed by:

  • Two directors of the company; or

  • A director and a company secretary of the company; or

  • For a proprietary company that has a sole director who is also the sole company secretary – that director (section 127(1) Corporations Act)

If executed this way people can rely on the assumptions in section 129 (5) Corporations Act in dealing with the company.

A company with a common seal may execute a document where the document is fixed to the document and is witnessed by:

  • Two directors of the company; or

  • A director and a company secretary of the company; or

  • For a proprietary company that has a sole director who is also the sole company secretary – that director (section 127(2) Corporations Act)

If executed this way people can rely on the assumptions in section 129 (6) Corporations Act in dealing with the company. A company may execute a document as a deed in accordance with subsections (1) or (2).

Section 127(4) Corporations Act provides that section 127 does not limit the ways in which a company may execute a document, including a deed. This means that it can use a procedure as outlined in the Company’s Constitution.  

AGENT EXERCISING A COMPANY'S POWER TO MAKE CONTRACTS

Section 126 Corporations Act states that a company’s power to make, vary, ratify or discharge a contract may be exercised by an individual acting with the company’s express or implied authority and on behalf of the company. This power may be exercised without using the common seal.  

NEED MORE INFORMATION

Behan Legal advises and assists clients on these important issues. For an appointment, call 03 9646 0344 .

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