Post by Oby Pink Egbe (@pinkrepublic12)

FREE LEGAL ADVICE FOR THOSE OF YOU REPRESENTING A COMPANY, OR EVEN SPEAKING ON THEIR BEFORE EVEN IF YOU ARE A DIRECTOR OF THAT COMPANY:

A company generally bears the legal consequences of its actions, but directors, officers, or agents can face personal liability if they step outside their authorized roles or give personal guarantees.
Corporate Liability vs. Personal Action
• Separate entity: A corporation is an artificial legal person. It acts through agents like directors and officers.
• Company liability: When an officer acts on behalf of the company, the company itself is held liable for legal consequences, not the natural person.
• Personal guarantees: If a director says "I personally guarantee this," they assume a personal obligation and can be held personally liable if the company fails.
• Exceeding authority: Anyone who signs a document or acts without proper authority risks personal liability for resulting losses.
• Piercing the veil: Courts can "lift the corporate veil" in cases of fraud or abuse, making owners and directors personally responsible for company debts.

FREE LEGAL ADVICE FOR THOSE OF YOU REPRESENTING A COMPANY, OR EVEN SPEAKING ON THEIR BEFORE EVEN IF...

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Comments

Anusha: that;s a lovely necklace!
Felix: This is a useful reminder that being a director does not automatically shield you from personal liability, especially when you act beyond your authority or make commitments in your own name.
RT. Comr. Hayatu Deen: Thank you so much for this MA
Dordiase: This is solid and timely advice.
Many directors don't know where company liability ends and personal liability begins until it's too late. Especially the part on personal guarantee and piercing the veil that's where a lot of people enter trouble unknowingly.