Since companies are creations of the law, they are pre-dominantly required to be governed by the use of law (Omar, 2004). Thus, the governance of companies is inevitably dependent on the formation of fruitful law and its stringent enforcement. Ultra Vires is the doctrine of allowing a company to act in a way which seems to be beyond their powers, and this doctrine has been abandoned with the growing investor participation and with the rise of social inclusive policies. Since Nick has been trying to sell his shares without consulting a David and George, he is simply trying to act in way that is beyond his powers, because he is not having nay power to go out and sell his shares to an outsider when he did not attempt to sell it to existing shareholders. Further, he also mortgaged the property owned by Scottish Holdings ltd without the knowledge of David and George, and raised money from a bank by giving it the sole charge on the property. Nick acted in a way which gave him powers beyond his actual limits as he could not mortgage any company property without informing other partners and create a single charge on it, along with using the raised money for personal use. When there is a legislation supporting Ultra Vires, then the owners or the director or the management will have super powers to direct the company in a way which will not be beneficial to other shareholders, especially the minority ones. With such powers, the directors can take unsubstantial risk which the other shareholders would not want them to take. In addition, the directors can also use such powers to influence the decision of appointing superior positions in the company and make their family members as successors and thus keep complete control of the company’s conduct making it more difficult for minority shareholders to access information and details about any type of transactions or financial irregularities. Thus, Ultra Vires do not provide any protection to investors and creditors of a company.