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The articles of Dorking Ltd. contain a power to appoint a managing director, but this is never done. One of the directors, to the knowledge (but without the express authority) of the remainder of the board, acts as if he were managing director in arranging a contract. Later, Dorking Ltd. refuses to honour the contract. Is Dorking Ltd. bound by the contract? A. No. the director may have had apparent authority, but he had no actual authority. B. Yes. The director had actual authority, and this is the crucial thing. C. No. The director had no apparent or actual authority. D. Yes. The director had apparent authority and Dorking Ltd. had acquiesced to this, and this is enough to bind it. |