The Memorandum of Association of a Company has to be lodged with the Registrar of Companies

However this created problem for outsiders who who had no knowledge if some internal proced
THE INDOOR MANAGEMENT RULE
To circumvent the above problem the Courts developed the Indoor Management Rule. This princ
In the above case, the Directors of a Company issued a bond to the Royal British Bank.The A
The Company claimed that there was no resolution passed authorising the issue of the bond a
The Court held that the Company was entitled to sue on the bond. As the requirement for the
The rule is also known as the Indoor Management rule.
The rule in Turquand's case is a presumption of regularity. In other words, a person dealin
To summarize the above points
1. If an officer of the Companyhas exceeded his authority as given to him by the AA
2. there has been some non compliance with an internal procedure
3. the outsider may presume that the internal procedure had been complied with.