Signing a document on behalf of a corporation while deviating from permission will usually bind the corporation

A lawyer demanded a fee for legal services provided to a non-profit society under a retainer fee agreement signed by one of the society members, along with the society’s stamp.
The Court rejected the claim against the society. An action deviating from a corporation’s objectives or performed without permission is invalid unless ratified by the general assembly or the organ authorized to grant permission. However, where a third party was unaware of the absence of permission and need not have been aware thereof, the signature will be binding on the corporation. Here, pursuant to the provisions of the articles of association the signatures of two members were necessary to bind the society and the lawyer should have known that. Thus, the agreement is not be binding on the society, although it is possible to personally sue the society member who signed the agreement without authority.