MI Bar Practice Questions - Michigan Bar Examination Exam

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An employee of a Michigan corporation, acting within actual authority, signs a contract on the corporation's behalf. Later the corporation argues the contract is unenforceable because the board never formally approved it, even though it had authorized the employee generally. The contract is most likely:

Unenforceable for lack of board minutes Enforceable only if ratified in writing by all shareholders Enforceable, because an agent with actual authority binds the corporation Void as ultra vires in every case

Correct Answer:

Enforceable, because an agent with actual authority binds the corporation

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