Corporations Act 2001 (Cth)
Section 124 gives a company the same legal capacity as ‘an individual’ including the power to make an agreement and s 125 effectively provides that the performance of an act – including entry into an agreement – by a company will not be invalid merely because it is beyond the power of the company’s constitution.
A company may make a contract through an agent acting on its behalf. Section 126 empowers a person acting on behalf of the company with its express or implied authority to ‘make, vary, ratify or discharge a contract.’
A contract made by a promoter of a company on behalf of the company but before it has been formed is enforceable pursuant to s 131(1) of the Corporations Act 2001 provided that the company, once formed, ratifies that pre-registration contract within an agreed time or, if no time is set, a reasonable time. If the company does not form or ratify the contract the individual responsible for making the contract on its behalf may also be liable (s 131(2)).