Corporate transactions

Ahmad, Muhamad Hassan and Ali Mohamed, Ashgar Ali and Arowosaiye, Yusuf Ibrahim and Masum, Ahmad and Eishan Jan, Mohammad Naqib (2025) Corporate transactions. In: Company Law in Malaysia. Sweet & Maxwell, Thomson Reuters, Kuala Lumpur, Malaysia., pp. 103-121. ISBN 978-629-7700-74-8

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Abstract

In the realm of company law, contracts are a fundamental mechanism through which companies engage in business activities and commercial transactions. However, the legal effect of such contracts depends heavily on when and by whom they are entered into. Accordingly, this chapter explores the legal framework governing business contracts in different stages of a company starting from pre-incorporation contracts to those concluded before a company is entitled to commence business, and to those entered into after proper incorporation and a company is entitled to commence business. Beyond the company’s own legal status, the authority of individuals acting on its behalf, that is, its corporate agents, plays a critical role in determining the validity and enforceability of contracts. Thus, this chapter also analyses the legal principles of agency, including “actual authority” – either express and implied – and “apparent” or “ostensible” authority, with reference to both statutory provisions and judicial precedents. Furthermore, the chapter considers the doctrine of constructive notice and the indoor management rule, that is, the Turquand’s rule, which aims to strike a balance between protecting third parties dealing in good faith with the company, and ensuring that internal governance rules are complied with properly. Through statutory references such as the Companies Act 2016 (“CA 2016”) and the Contracts Act 1950, as well as case laws, this chapter provides a comprehensive understanding of how contractual obligations are created and enforced in the context of company law.

Item Type:	Book Chapter
Uncontrolled Keywords:	Corporate transaction, commercial transaction, contractual obligations.
Subjects:	K Law > K Law (General)
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Ahmad Ibrahim Kulliyyah of Laws > Department of Civil Law
Depositing User:	Dr. Muhamad Hassan Ahmad
Date Deposited:	10 Nov 2025 10:14
Last Modified:	10 Nov 2025 10:14
URI:	http://irep.iium.edu.my/id/eprint/124238

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