What does ultra vires mean in relation to a company incorporated under the Companies Act 1985?

• A. Acting outside the objects clause (powers).
• B. Acting within the objects clause.
• C. Acting within the powers as defined by the articles.
• D. Acting illegally but within the corporate capacity.

Answer: (A)

Ultra vires means acting outside the powers the company is allowed to have, as set out in its constitution. For a company formed under the Companies Act 1985, the memorandum defines the objects—the activities the company can pursue. If directors or the company do something beyond those objects, that act is ultra vires and typically not binding on the company. So the correct interpretation is acting outside the objects clause (powers). Acting within the objects is the opposite (intra vires). The articles govern internal rules, not external capacity, so relying on them to grant external powers would be incorrect. And ultra vires is about scope, not illegality.