This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 365.— With further reference to the above, the secretary-treasurer of a limited company accepted drafts on its behalf. On enquiry to the president as to his authority I was told that it was not necessary that he should have authority given him. On this information would I be justified in taking the acceptance?
Answer.—All that seems to be involved in the statement made by the president is his opinion that the secretary-treasurer, by right of his office, has power to bind the company in the way mentioned, and we do not think this is the case. Even, however, if the president meant to assert more, we do not think his assertion, if not consistent with the fact, would necessarily be binding on the company; it would depend on the scope of the president's authority. You would not, on the information given, be justified in taking this acceptance.