User:Samughal

Agency by ratification

If a duly appointed agent exceeds his authority, or a person having no authority purports to act as agent, the principal is not bound. The principal may however adopt the contract at a later date, provided:

1:The agent named or otherwise identified his principal and the third party knew that the agent was contracting as agent. In Keighly Maxsted v Durant A was authorized by Principal to buy wheat at a certain price. In excess of his authority A bought T at above that price. Agent professedly contracted in his own name without disclosing the agency to T. The next day P purported to ratify. It was held that P could not ratify because A had neither named nor otherwise identified P and T did not know he was dealing with an agent.

2:The principal had contractual capacity at the date both the contract and the ratification. If the principal is a company this means it must have been incorporated at the time of the contract. In Kelner v Baxter P sold wine to D who purported to act as agent for a company which was about to be formed. When it was formed the company attempted to ratify the contract made by D. It was held that it could not do so, since it was not in existence when the contract was made.

3. The principal had full knowledge of all material facts, or was prepared to ratify in any event.

4. The principal must ratify the whole contract, not merely parts of it.

5. The principal must ratify within a reasonable time.

6. The principal must communicate a sufficiently clear intention of ratifying, either by express words or by conduct.

A void or illegal contract cannot be ratified because it is of no legal effect from its inception.

Ratification gives A retrospective authority.

It can therefore be seen that the main difference between creation of agency of necessity and that by ratification is that agency of necessity is created by operation of law without the agreement of the principal; whereas agency by ratification can only be created with the knowledge and consent of the principal. --Samughal (discuss • contribs) 15:06, 3 April 2013 (UTC) S.A.Mughal