How do you know someone signing an agreement has the right to do so?

Always, wondered this, and never found a good answer. Guess the opposite applies, too -- how do you know someone does NOT have the right to enter a legal agreement on behalf of a company?

Please cite sources: US Federal Law and/or Case Law Thanks!

You don't know, though sometimes you can do research to gain comfort.

In practical terms, one relies on:

• The signing individual's representation that s/he has authority to bind the company. If that representation proves to be false, you can go after him / her personally.
• The fact that, under certain circumstances, an individual with apparent authority can bind a company, even if s/he did not have actual authority. Please see "Who Can Sign a Contract for a Corporation? "

Disclaimer: This post does not constitute legal advice and does not establish an attorney-client relationship.