Section 40(2)

For this purpose— a person “deals with” a company if he is a party to any transaction or other act to which the company is a party, a person dealing with a company— is not bound to enquire as to any limitation on the powers of the directors to bind the company or authorise others to do so, is presumed to have acted in good faith unless the contrary is proved, and is not to be regarded as acting in bad faith by reason only of his knowing that an act is beyond the powers of the directors under the company's constitution.

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Source: legislation.gov.uk · retrieved 2026-09-04