xxdd cdddddddddddddddddddddThe Forgery may in circumstances exclude the Turquand rule. In Ruben V. Great Fingall Consolidated, the plaintiff was the transferee of a share certificate issued under the seal of the defendant company. The certificate was issued by the company’s secretary, who had affixed the seal of the company and forged the signatures of two directors. The plaintiff contended that whether the signature were genuine or forged was a part of the internal management and, therefore, the company should be estopped from denying the genuiness of the document. But it was held that the rule has never been extended to cover such a complete forgery. It was said that it is quite true that persons dealing with limited liability companies are not bound to inquire into their indoor management and will not be affected by irregularities of which they have no notice. But this doctrine, which is well established, applies to irregularities of which they have no notice. But this doctrine, which is well established, applies to irregularities which otherwise might affect a genuine transaction. It cannot apply to a forgery.
This statement has been regarded as a dictum, as the case was decided on the principle that the secretary did not have actual or implied authority to represent that a forged document was genuine and, therefore, there was no estoppel against the company.
In Official Liquidator V. Commissioner of Police, a document on which a company borrowed a sum of money was executed by the managing director who was the chief functionary of the company and, to comply with the requirements of the articles, the signatures of two other directors were forged, the company was not allowed to eschew liability under the document.
We hold the matter liable as a matter of social and economic policy. The basis of liability is the eminently practical view that if authority is