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7 • 2008

How many officers must sign a document to bind the corporation?

Even if a corporation has not properly authorized a corporate transaction, the corporation may not raise the “due authorization” defense when a document is signed by (1) the board chairman or president or any vice president; AND (2) the secretary or any assistant secretary or the chief financial officer or any assistant treasurer (See, Cal. Corp. Code Sec 313). If two corporate officers – one from each category – sign a document, the corporation is bound so long as the person accepting the signatures had no actual knowledge that the person signing lacked authority (See, Snukal v. Flightways Mfg. (2000) 23 C4th 754, 784, 98 CR2d 1, 26).