Another Example Of California Imposing Its Will On Foreign Corporations

As has been discussed many times in this space, the California General Corporation law purports to govern foreign corporations in a number of respects.  One such provision is Section 208 of the Corporations Code which apples to:

  • Contracts and conveyances made by a foreign corporations in California; and
  • All conveyances by foreign corporations of real property situated in California.

Section 208, with three exceptions, negates the defense of ultra vires.  The statute also binds the corporation to any contract or conveyance made in the corporation's name that is: (i) authorized or ratified by board of directors; or (ii) done within the scope of the authority, actual or apparent, conferred by the board or within the agency power of the officer executing it, except as the board's authority is limited by law other than the General Corporation Law.   This will be the case regardless of whether the contract is executed or wholly in part executory.