If you enter into a contract and the other party later tries to withdraw from it by claiming that the person who signed did not have the authority to sign on behalf of the company, contact a lawyer. In some cases, the contract may still be enforceable. A legal problem can arise when someone signs on behalf of a company and is not an authorized representative. In some cases, the company may withdraw from the contract on this basis. When you create a business as a corporation, the company becomes a separate legal entity. Your name is no longer valid if you sign contracts between the Company and another party. Representatives must be authorized to sign. These representatives may include board members, managers and other staff. If an employee who is not authorized signs a document or contract on behalf of the company, it can lead to legal problems.

Beyond that, however, there is a grey area. Can an executive or subordinate manager link the company with a signature? How about someone who is not even a manager? When a manager has this type of responsibility in the operation of the company, it is common for him to sign a commercial contract. However, the other party concerned may require proof that the undersigned manager is authorised to carry out this task on behalf of the company. Contracts are critical to the success and growth of businesses in many industries, especially contracts that help the business stay in business. In general, managers who frequently sign for their company have received an explicit power of attorney, while others who sign have acted on the basis of an implied power of attorney, and the latter often gives rise to disputes over the appropriate signing authority. An agent may reasonably believe, on the basis of various affirmative statements or actions of his company, that he was given the authority to sign a contract when in fact this was not the intention. In this case, the company may or may not be bound by the contract, depending on the circumstances. When creating business documents, make sure the language is clear and concise to protect yourself from signatures from those who are not authorized to do so.

For example, the company`s articles of association should include a list of officers authorized to sign. You can have your employees sign contracts indicating whether they are authorized to sign legal documents for the company. If an employee is authorized to subpoena in certain circumstances, you may want to create a power of attorney that includes the details of that power of attorney. A signed contract is a legally binding contract between two or more parties. The parties agree on the terms of the agreement and accept the legal framework of the contract for the provision of the services and the resolution of potential disputes. The parties are liable for breaches of contract. A contract can be signed electronically or in wet ink if it is a written contract. However, the signing of a contract is only valid if the person who signed the contract was actually authorized to sign the contract. Before entering into a contract, whether it is a simple contract or not, it is best to check if the other party has the power of attorney to avoid legal problems and unnecessary delays.

Apparent authority is very similar to implicit authority. The difference is that the employee expresses to third parties that she is authorized to act on behalf of the employer, but this allegation is manifestly false or false. If the employee gives this assurance and the third party reasonably believes in the statement, the employee is deemed to have clear authority. As such, the employer would be bound by the contract. A limitation of this type of power is that the reasonable presumption of the third party must generally be due to an act of the employer. For example, if the employer has expressly limited the employee`s powers, but has not alerted third parties to this limitation of power, it is natural for the employer to assume the risk of an employee`s unauthorized acts. Occasionally, you may allow an employee to sign a specific contract or type of contract, but not all contracts. This may be the case if the employee is located in a different geographical area or is responsible for a specific part of the company. A great way to do this is to use a power of attorney document that carefully outlines the types of documents the employee can sign.

To avoid such disputes, developing clear signing authority guidelines may be the best solution. If an employee is only required to sign on behalf of their company in a specific case and their belief in implied signing authority should be restricted in all cases, preparing a power of attorney to approve the signature is recommended, although this may not be appropriate on all occasions. Under English law, a contract is signed as an act if the contract is expressly marked as an act and the signatory signs the document in the presence of a witness. An important requirement for a document is that the witness must sign under the signer`s signature and that the names of the signatories be marked on the document to uniquely identify their signatures. For example, legal documents such as a surety bond or power of attorney must be signed as a deed to compensate for the lack of consideration. Directors of a corporation have the authority to sign legal documents on behalf of the corporation. A company secretary and employees in a specific position within the company may also have the express or implied authority to sign certain types of documents, such as simple contracts, on behalf of the company.