Section 89 CAMA 2020

Section 89 Companies and Allied Matters Act is about Acts of the general meeting, board of directors, or of managing directors. It is under Liability for Acts of the Company of Chapter 5 of PART B (Incorporation of Companies and Incidental Matters) of the Act.

Acts of the general meeting, board of directors, or of managing directors

Any act of the members in general meeting, the board of directors, or a managing director while carrying on in the usual way the business of the company, shall be treated as the act of the company itself and the company is criminally and civilly liable to the same extent as if it were a natural person :

Provided that—
(a) the company shall not incur civil liability to any person if that person had actual knowledge at the time of the transaction in question that the general meeting, board of directors, or managing director, as the case may be, had no power to act in the matter or had acted in an irregular manner or if, having regard to his position with or relationship to the company, he ought to have known of the absence of such power or of their irregularity ; and

(b) if in fact a business is being carried on by the company, the company shall not escape liability for acts undertaken in connection with that business merely because the business in question was not among the business authorised by the company’s memorandum.