53. (a) The company shall be directly liable in tort for any civil wrong committed by one of its organs.

(b) Nothing in the provisions of subsection (a) shall derogate from the company’s vicarious liability in tort under any law.

Liability of company in tort

54. (a) Attribution of an act or intention of an organ to a company shall not derogate from the personal liability that individuals in such organ would have borne but for such attribution.

(b) In addition to the provisions of section 6, the court may attribute the rights and obligations of a company to individuals in various organs if the conditions prescribed for lifting the veil in section 6(c) have been fulfilled, mutatis mutandis, or if a condition prescribed in any enactment for attributing rights and obligations as aforesaid has been fulfilled.

55. (a) A company, or anyone acting on behalf of a company, shall not perform any act that constitutes a departure from the objects laid down in the articles of association and shall not perform an unauthorized act or an act that goes beyond any authorization.

(b) Where an act under subsection (a) has been performed, or where there is reason to presume that such an act is about to be performed, the court may, at the request of the company, a shareholder, or a creditor of the company in respect of whom there is an apprehension that his rights may be prejudiced, grant an order interrupting or preventing the act.

Act departing from authorization

56. (a) An act performed for a company which departs from the objects laid down in its articles of association, or performed without authorization, or beyond such authorization, shall be invalid in respect of the company, unless the company approved the act in the ways prescribed in subsection (b), or if the party in respect of whom the act was performed did not know and was not expected to have known of the departure or of the lack of authorization.

(b) Ex post facto confirmation by a company of an act which departs from the objects prescribed by its articles of association shall be granted by the general meeting; such confirmation relating to an unauthorized act or an act which departs from a given authorization shall be granted by the organ empowered to issue such authorization.

(c) Confirmation referred to in subsection (b) shall not prejudice any right acquired by another person bona fide for value prior to grant of the confirmation.

Act departing from objects or without authorization

57. Resolutions of the company in respect of the following matters shall be passed by the general meeting:

(1) alterations in the articles of association as referred to in section 20;

(2) exercise of the powers of the board of directors in accordance with the provisions of section 52(a);

(3) appointment of the company’s auditor, his conditions of employment and termination of his employment in accordance with the provisions of sections 154 to 167;

(4) appointment of External Directors in accordance with the provisions of section 239;

(5) confirmation of acts and transactions requiring confirmation of the general meeting under the provisions of sections 255 and 268 to 275;

(6) increase and reduction of the registered share capital of the company in accordance with the provisions of sections 286 and 287;

(7) merger referred to in section 320(a).

58. (a) A company may not contract out of the provisions of section 57.

(b) A company may add matters to its articles of association, where resolutions in that respect shall have been passed by the general meeting; however, the transfer of powers in the articles of association to the general meeting, in respect of matters where power was conferred on another organ in this Law without any possibility of contracting out in respect of such matters in the articles of association, shall be effected in accordance with the provisions of section 50.

59. The annual general meeting shall appoint the directors, unless provided otherwise in the articles of association.

Article B: Annual General Meeting and Special General Meeting >>