Corporate capacity

A company has the legal capacity and powers of an individual, and is able to engage in any business or activity in the same way as a natural person.

The Corporations Act 2001 (Cth) (CA) abolished the historical doctrine of ultra vires, so that a company's act is no longer invalid merely because it is contrary to, or beyond, any of the objects in its constitution.

However, a company's exercise of certain corporate powers may be subject to the CA, such as a company's power to cancel or acquire its own shares.

The CA provides that a company may ratify a contract entered into by its agent prior to its formation or registration.

See Corporate capacity.