How must a service contract for a director be executed?

In the context of service contracts for a director, execution as a deed is significant because it carries specific legal implications and requirements. A deed is a formal legal document that must generally be executed with certain formalities, such as being written, signed, witnessed, and delivered. This formality is essential for ensuring that the commitment made under the deed is enforceable and recognized by law.

Service contracts that are executed as deeds offer greater protection and can be binding even in situations where other forms of contracts might require additional consideration to be enforceable. This is particularly important for directors, as their roles often involve fiduciary duties and responsibilities that merit a higher standard of documentation.

Other forms of execution, such as verbal agreements or informal contracts, lack the same level of legal enforceability, which could expose the parties to risks regarding the clarity and binding nature of the terms agreed upon. A memorandum typically serves a different purpose, often being a record of informal discussions rather than an enforceable agreement. Therefore, executing a service contract for a director as a deed ensures it meets the necessary legal standards for clarity, enforceability, and formal recognition.