Effective 1 June, we have a new address: 34 Imperial Square, Cheltenham, Gloucestershire GL50 1QZ
Get in Touch Menu

A warning for directors when signing documents

28 November 2013

Category: Press releases, Commercial, Dispute resolution

In the case of Hamid v Francis Bradshaw Partnership (FBP), Hamid was the director of a company, Chad Furniture Store Limited (Chad), trading as Moon Furniture. He signed a contract with FBP, who understood that Hamid owned Moon Furniture, which indirectly was true.

The contract included a letter written under the name of Moon Furniture and included its website URL, email and address. Hamid signed the document, above his typed name and Moon Furniture was typed directly below. There was no indication Hamid may be signing as a director on behalf of Chad. FBP was unaware of Chad.

The case went to the Court of Appeal which held that Hamid did not effectively qualify his signature or make it clear that the contract did not bind him personally. The mere reference to Moon Furniture without reference to Chad, the company (or indeed any company), was not an effective qualification. The court found that Hamid had signed on his behalf, and not for the company. He was therefore personally liable for the terms of the contract.

This case highlights that directors should be vigilant when signing documents, especially contracts, and provides a useful reminder that the parties to a contract should always be clearly identified.

When a company operates using a trading name, directors should take care to clearly identify the company and that they are signing on its behalf (and not personally). Otherwise, directors may face personal liability.

Paul Gordon LLB
View profile
Related services
Share this article
Resources to help

Related articles

Top tips for improving wellbeing in the workplace


A recent CIPD Health and Wellbeing at work survey has reported that most organisations are taking additional measures to support employee health and wellbeing, in response to COVID-19. Three quarters…

Jenny Hawrot LLB (Hons)

SCCs: New rules governing cross-border data transfers and data exchanges from the EU and EEA

GDPR & data protection

This September brings change to the use of standard contractual clauses (SCCs) governing data transfers from the EU and EEA. In June this year, the European Commission published two sets…

Kym Fletcher LLB (Hons) Euro
Consultant, solicitor

Catch up on our free legal webinars


Our legal experts have been busy sharing valuable expertise in their first series of free webinars for employers, and businesses across the county who missed the live events can now…

Contact us