How many directors need to sign?
Signing documents that bind a company to obligations and potential liability is a key aspect of being a director of a company. It is part of the role when a director is guiding and running the company.
While shareholders are required to ratify major transactions and key decisions, day to day, the directors are in control. They can delegate duties to CEOs and managers but ultimately have responsibility for directing and overseeing what the company employees do.
Directors sign key documents at the Board level, following the constitution of the company, which spells out how many directors are required to sign to bind the company. The mechanics are that if two sign there does not have to be a witness to that signing. Where one signs only, there must be a witness.
Major document signing should be done following a written directors Board resolution relating to that particular matter.
Usually two directors sign once the resolution is in place. This protects the directors and the company. They have each other’s backs and a clear paper trail of the document signing process.
Authorised signatories may be able to sign some documents either alongside one director or in their place. In these instances, delegation protocols need to be in the relevant background paperwork.
Importance of insurance in buying a home
Insurance is absolutely crucial, and when borrowing from lenders to complete a house purchase, it is compulsory. Lenders will not allow a loan drawdown without written confirmation that appropriate and sufficient insurance cover is in place.
Usually there is replacement insurance relating to fire, earthquake and other damage. Cover for contents go hand in hand with the replacement cover, but is not compulsory. Highly recommended though!
These days you really need a valuation of the home being purchased to set the correct and allowable amount of cover to be sought. Banks and other lenders insist on this and then check the numbers in respect of what they are lending in dollar terms against the potential insurance pay-out in the event of damage to your house.
Replacement cover gives all the answers. The lender wants to know its lending is secure, and your house has the ability to be rebuilt at best while covering the amount they have lent at worst.
While fire and wilful damage are the cornerstone of insurance cover and why it is vitally important, these days earthquake risk is also on everyone’s minds and must be included when arranging such cover.