Most contracts in a small business get signed by whoever was closest to the deal. The founder signs the lease, the operations lead signs the software renewal, a manager signs a supplier agreement because the supplier asked them to. It works until somebody signs something they had no authority to sign, and whether the business is bound by it stops being a theoretical question.
This guide covers who can sign on behalf of a New Zealand company, how authority works in practice rather than on paper, and what a workable signing policy looks like for a business of 5 to 200 people. It is general information rather than legal advice, and anything high value is worth running past a lawyer.
What the Companies Act requires
Section 180 of the Companies Act 1993 sets out how a company enters into an obligation. It splits agreements into three groups, based on what the law would require if a person signed rather than a company.
- Anything that would have to be a deed if a person signed it. These are signed under the company name by two or more directors, or by the sole director if there is only one, whose signature must be witnessed. A company can also appoint an attorney to sign deeds on its behalf
- Anything that must be in writing. These can be signed by a person acting under the express or implied authority of the company, which means an employee can validly bind the business
- Anything that does not have to be in writing. These can be entered into in writing or verbally by a person acting under express or implied authority, which is why a phone call can create a contract
The practical reading is simple. For most commercial agreements, a staff member with authority can bind the company and no director signature is required. Deeds are the exception, and the common ones for an SME are property and finance related: certain leases, guarantees, and some lending documents. If a document calls itself a deed, treat the signing requirements as stricter and check before anyone signs.
Express authority, implied authority, and the gap between them
Express authority is what you have actually given someone, ideally in writing. Implied authority is what comes with the role. A finance manager is reasonably understood to be able to commit to an accounting subscription. A warehouse supervisor is reasonably understood to be able to order packaging. Nobody writes either of those down, and counterparties treat them as real.
The risk sits in the gap between the two. Where a business lets somebody appear to have authority, through a job title, an email signature, or simply by letting them run the negotiation, the other side can usually rely on that appearance even if your internal rule said otherwise. Telling a vendor afterwards that your ops lead was not allowed to agree to a three year term is rarely a defence, because the vendor had no way of knowing your internal limits and no obligation to ask.
Which means the internal policy is not really there to protect you from counterparties. It is there to stop commitments being made that nobody in the business would have approved.
What a signing authority policy should cover
One page is enough. The useful version answers five questions.
- Who can sign what, by value. A common structure for an SME is up to $5,000 a department lead, up to $25,000 the operations or finance lead, and above that a director
- Who can sign what, by type. Employment agreements, anything containing a personal guarantee, anything with an indemnity, and anything that calls itself a deed usually go to a director regardless of value
- What counts as the value. Annual cost is the number people reach for, but total value over the full term is the one that matters on a multi year agreement
- What has to happen before signing. Who reviews it, what gets checked, and where the signed copy goes afterwards
- What happens when the approver is away. Most policies fail at exactly this point, because the fallback is unstated and the deadline is real
The last line of the policy is the one most often missing: every signed agreement goes to one place under the business's control, on the day it is signed.
The failure that actually costs money
In practice, few SMEs get burned by a genuinely unauthorised signature. What happens far more often is quieter. Somebody signs something they were perfectly entitled to sign, saves it in their own email, leaves the company eighteen months later, and the agreement renews on terms nobody left in the business has read. The authority was fine. The record keeping was not.
That is why a signing policy and a contract register belong together. A policy tells you who may commit the business. A register tells you what the business is actually committed to, which is the question you need answered when a renewal notice arrives or a buyer starts due diligence. We cover that side in contract register: what to record about every contract.
Where Miova fits
Miova gives signed agreements somewhere to land that is not an individual inbox. Forward the signed PDF to your private upload address and the parties, key terms, dates and values are extracted from the document, so the record exists without anybody filling in a form. Each contract can be assigned an owner, which makes the person accountable for the next renewal decision visible rather than assumed.
The renewal and termination alerts then handle the part a policy cannot. They make the next commitment a decision somebody makes on time, rather than a default that happens because the paperwork was somewhere else.
The short version
Under New Zealand law, most commercial agreements can be signed by any employee acting with your express or implied authority, and deeds are the tighter exception. Because a counterparty can rely on apparent authority, your internal limits protect the business from itself rather than from vendors. Write those limits on one page, set them by total contract value as well as by type, and finish the policy with where the signed copy goes. That last part is the one that usually gets skipped, and it is the one that costs money later.