• 1 Marks

BL – Nov 2012 – L1 – SA – Q15 – Company Law

Identify which clause limits ultra vires actions in a company.

An act of a company which is considered as ultra vires is that which is not authorized by ONE of the following:
A. Subjects clause
B. Directors clause
C. Authorization clause
D. Shareholders clause
E. Objects clause

E. Objects clause

Explanation:
An ultra vires act is one that goes beyond the powers defined in the company’s objects clause, which limits the company’s scope of operations.

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