Question

Mr. Y a member of Company XYZ makes a contract with his company XYZ.

• A. It is illegal
• B. It is legal
• C. Depend in the situation of case.
• D. None of the above.

Answer 1

The correct option is B It is legal

A member of company is one of the company’s owners whose name has been entered on the register of members. Members delegate certain powers to the company’s directors to run the company on their behalf. Shareholders also can be member of the company once their name is registered in the register of the company. The contract between company and its member is legal and enforceable in nature under their individual capacity.