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180: Method of contracting
or “How a company can make legally binding agreements”
You could also call this:

“Giving someone the power to act for your company”

If your company allows it in its constitution, you can give someone the power to act for your company. This person is called an attorney. You can give them power to act for your company in general or for a specific task. To do this, you need to write it down and sign it the same way you would sign other important company documents.

When your attorney does something that you’ve given them power to do, it’s just like your company did it. Your company is responsible for what the attorney does.

There are some rules about how these powers of attorney work for companies. These rules are similar to the ones for when a person gives someone else power of attorney. If your company stops operating or is removed from the companies register, it’s like the power of attorney has been cancelled. This is similar to what happens when a person who gave someone power of attorney dies.

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Next up: 182: Pre-incorporation contracts may be ratified

or “Companies can approve contracts made before they were officially formed”
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Part 10 Administration of companies
Authority to bind company

181Attorneys

  1. Subject to its constitution, a company may, by an instrument in writing executed in accordance with section 180(1)(a), appoint a person as its attorney either generally or in relation to a specified matter.

  2. An act of the attorney in accordance with the instrument binds the company.

  3. Sections 19 to 21 of the Property Law Act 2007 apply, with all necessary modifications, in relation to a power of attorney executed by a company, to the same extent as if the company was a natural person and as if the commencement of the liquidation or, if there is no liquidation, the removal from the register kept for the purposes of this Act of the company was an event revoking the power of attorney within the meaning of those sections.

Notes
  • Section 181(3): replaced, on , by section 364(1) of the Property Law Act 2007 (2007 No 91).