All by myself
30 April 2008
The Companies Acts (1985 and 2006) set out how companies incorporated in England and Wales may execute contracts and other documents.
Now companies can benefit from a simpler method of executing documents. Documents such as deeds and share transfers which previously needed to be executed by either two directors or a director and the company secretary, may now be capable of being executed by only one director in the presence of a witness.
This change applies to both public and private companies. We would recommend that before utilising this new method of execution, directors should review and determine whether any provisions in a company’s Articles of Association need to be changed to accommodate the new procedure.
If adopted, the company’s standard documentation and execution pages will potentially need updating. Additionally for risk management purposes, the company may decide that transactions of certain sizes should still require the signature of more than one director and will need to update the company’s signing authority guidelines accordingly.
There are no changes to the law affecting contracts other than deeds. These may continue to be executed on behalf of a company by any person acting under its authority, express or implied - usually a single director or other authorised signatory.
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