director misappropriated the cherub and the plaintiff sued the company

The director misappropriated the cherub and the plaintiff sued the company. Held, the company was not liable as the act was outside the apparent authority of the director, and the company had done nothing to hold out the director having such authority. Knowledge of the provisions giving such authority was essential.Forgery. The protection under the Rule is not available where the outsider is found to have relied upon a document which is a forged one. A document is a forgery when the seal of the company is affixed without authority or the signatures of an authorized official are forged thereon.

Thus, in Ruben Vs. Great Fingall Ltd., the secretary of the company issued a share certificate to the plaintiff by forging the signatures of two directors, as required under the Articles. The company refused to accept him as a shareholder of the company because of the forged share certificate. The plaintiff pleaded that the signature of the directors were genuine or forged was a part of internal management and the company must be stopped from denying the genuineness of the document. It was held that the plaintiff was not a shareholder and the certificate was the nullity.Acts Outside the Usual Authority of the Company's Official. The articles of association ofthe company empowered the directors to determine who should have authority to draw, accept etc., bills on the company's behalf. The company had its branch at Manchester, C. The company's Manchester branch manager, drew seven bills on the company's behalf in favour of Kredit-bank Cassel, who took them. believing C to be authorized to draw them. Actually C
had no such authority.The Court of Appeal held that the company was not liable for the bills because the drawing of bills was not within the authority of the branch manager, and nor the company ha< given him actual authority.