exceptions to the rule in turquand's case
Royal British Bank v Turquand The position in English law is now superseded by section 40[citation needed] of the Companies Act 2006,[2] but the Rule in Turquand's Case is still applied throughout many common law jurisdictions in the Commonwealth. According to the Turquand rule, each outsider contracting with a company in good faith is entitled to assume that the internal requirements and procedures have been complied with. The company will consequently be bound by the contract even if the internal requirements and procedures have not been complied with. The exceptions here are: if the outsider was aware of the fact that the internal requirements and procedures have not been complied with (acted in bad faith); or if the circumstances under which the contract was concluded on behalf of the company were suspicious.