Commercial Law, 2012 Bar — Question 49

MULTIPLE CHOICE

X, the President of ZZZ Corporation, was authorized by the Board of Directors of ZZZ Corporation to obtain a loan from YYY Bank and to sign documents in behalf of the corporation. X personally negotiated for the loan and got the loan at very low interest rates. Upon maturity of the loan, ZZZ Corporation was unable to pay. Which statement is most accurate? A) Because X was personally acting in behalf of the Corporation, he can be held personally liable. B) X, as President, cannot be personally held liable for the obligation of the corporation even though he signed all the loan documents, because the loan was authorized by the Board. C) YYY Bank can choose as to who it wants to hold liable for the loan. D) If ZZZ Corporation cannot pay, X can be held subsidiarily liable.

You can write freely without an account. Sign in to reveal the suggested answer and track your progress.