Can one representative bind a company?

In the case of Integral Petroleum SA v Scu-Finanz AG [2015] EWCA Civ 144, the Court of Appeal considered the validity of a contract governed by English law, where only one of the two representatives had signed.

The Facts

The case involved a supply contract between two Swiss oil companies, Integral Petroleum SA and Scu- Finanz AG. Under the terms of the contract, the claimant brought proceedings in England for failure to deliver the oil to them as specified in the agreement. One of the defendant’s defences was that the contract was not valid as it had only been signed by one of the defendant company’s representatives, when their constitution required for the signature of two.

The Decision

The Court of Appeal dismissed the appeal, stating that application of the relevant conflicts rule provided that the issue was governed by Swiss law, the place where the defendant company was incorporated. Swiss law required for the signature of two company representatives. The claimants appeal was dismissed on the basis that the contract was not valid.