Gazette Case: China Merchants Bank Dalian Donggang Sub-branch v. Dalian Zhenbang Fluorocarbon Coatings Co., Ltd. and Dalian Zhenbang Group Co., Ltd.
The Company Law's rules on internal approval for guarantees are primarily internal-control rules and do not automatically determine contract validity. Where a creditor has carried out the necessary formal review of shareholder resolutions and related authorization documents and has reason to believe the legal representative had authority, apparent representation may be found and the company remains bound by the guarantee.
Holding
The Company Law's rules on internal approval for guarantees are primarily internal-control rules and do not automatically determine contract validity. Where a creditor has carried out the necessary formal review of shareholder resolutions and related authorization documents and has reason to believe the legal representative had authority, apparent representation may be found and the company remains bound by the guarantee.