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Compute Ltd designs and manufactures computer keyboards.
The managing director of Compute Ltd is Mary Chip and the board of directors has given her the authority to undertake any transaction on behalf of the company up to a spending limit of $350,000. Any expenditure above this amount requires the approval of the board of directors. The other directors of the company are Major Quick and Slow Buck.
Mary Chip is on a business trip when she meets Bertie Boffin, an inventor who has designed a revolutionary method of inputting data into computers that could make the keyboard obsolete. Mary believes she has to act urgently to protect Compute Ltd's interest so she agrees that Compute Ltd will pay Bertie Boffin $400,000 to buy his invention. When Mary returns to Compute Ltd, the company's research and development staff determine that Berite Boffin's invention is not a threat to keyboards as Mary thought it might be. The other directors are angry with Mary for breaching their expenditure limit instruction and order that Compute Ltd should not pay Bertie on the grounds that Mary had no authority to act.
Required:
With reference to Corporations Act and case law, determine whether Bertie Boffin would succeed in enforcing the agreements against Computer Ltd.
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