Plain language law

New Zealand law explained for everyone

Companies Act 1993

Administration of companies - Pre-incorporation contracts

185: Breach of pre-incorporation contract

You could also call this:

“What happens if a company breaks a contract made before it was formed”

If a company breaks a contract that was made before it was formed, but which the company later agreed to, the court can decide what should happen. You or the company can ask the court to look at this, or the court can decide to do it on its own. The court can order the company to pay money or do something else to make things right. The court can also order the person who made the contract to pay money or do something, instead of or along with what the company has to do. The court will try to be fair when it makes these decisions.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320854.

Topics:
Business > Industry rules
Business > Fair trading
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184: Failure to ratify, or

“What happens if a company doesn't approve a contract made before it was formed”

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185A: Jurisdiction of District Court, or

“When the District Court can decide on pre-incorporation contracts”

Part 10 Administration of companies
Pre-incorporation contracts

185Breach of pre-incorporation contract

  1. In proceedings against a company for breach of a pre-incorporation contract which has been ratified by the company, the court may, on the application of the company, any other party to the proceedings, or of its own motion, make such order for the payment of damages or other relief as the court considers just and equitable, in addition to or in substitution for any order which may be made against the company, against a person by whom the contract was made.

Compare
  • 1955 No 63 s 42A(7)
  • 1983 No 53 s 15