Which cases transaction could be considered legally binding

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Reference no: EM131375108

AMC, Inc.’s board of directors have appointed Mr. Ahmed to be the Chief Financial Officer (CFO) of the corporation. The directors declared this appointment during a welcoming corporate dinner in AMC, Inc.’s head office. Mr. Ahmed signed the employment contract on December 15th, 2015. According to the employment contract, the employment takes effect in January 1st 2016. However, In December 18th, Mr. Ahmed attended a meeting with HP Company and signed a service contract, on behalf on AMC, Inc., for 2 million SR.

- From your point of view, discuss whether Ahmad’s act was legal or illegal. Can third party rely on the fact that he is representing the company? Could the court consider this transaction and enforce it? In which cases this transaction could be considered legally binding?

- You can create and illustrate your own scenario using the facts mentioned above. (You can add facts).

- Support your answer with rules from officers’ role and agency.

Reference no: EM131375108

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