Outline the rules that govern pre-incorporation contracts. Cite relevant case-law to support your answer.

A pre-incorporation contract is a contract entered into before a company is incorporated.
Rules governing pre-incorporation contracts

• A pre-incorporation contract does not bind the company. Kelner v Baxter

• A company cannot ratify a pre-incorporation contract Natal Land Co. v Pauline Colliery Syndicate Price v Kelsal

• A promoter is personally liable on a pre-incorporation contract Kelner v Baxter

R V Kyslant

• The company may be bound a pre-incorporation contract if it enters into a new contract similar to the previous agreement.
Mawagola Farmers Co. v Kayanja and others

• Before incorporation the company lacks contractual capacity and cannot have agents

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