40.—(1) Contracts may be made, varied or discharged on behalf of a credit union as follows:

(a) a contract which, if made between individuals, would be by law required to be in writing under seal may be made on behalf of the credit union in writing under the common seal of the credit union;

(b) a contract which, if made between individuals, would be by law required to be in writing, signed by the parties to be charged with the contract, may be made on behalf of the credit union in writing by any person acting under the express or implied authority of the credit union;

(c) a contract which, if made between individuals, would by law be valid although made by parol only, and not reduced into writing, may be made by parol on behalf of the credit union by any person acting under the express or implied authority of the credit union;

(d) a contract made according to this subsection may be varied or discharged in the same manner in which it is authorised by this section to be made and a contract under seal which, if made between individuals, might be varied or discharged in writing not under seal, signed by any person interested in the contract, may be similarly varied or discharged in writing not under seal on behalf of the credit union, signed by any person acting under the express or implied authority of the credit union.

(2) A signature purporting to be made by a person holding any office in a credit union attached to a writing by which any contract purports to be made, varied or discharged by or on behalf of the credit union shall, unless the contrary is proved, be taken to be the signature of a person holding that office at the time when the signature was made.

(3) Where authority no longer exists for the discharge of a credit union's obligations under subsection (1), the F108[Bank] may, if F108[it] thinks fit, appoint a person to act on behalf of the credit union, and a person so appointed shall have the like powers to make, vary or discharge contracts on behalf of the credit union as if acting under its authority.

(4) A contract which may be or have been made, varied or discharged according to the provisions of this section shall be effectual in law and bind the credit union and its successors and all other parties to the contract.