Ratification is adopting or accepting subsequently a past act of an agent done on behalf of another without authority. It is subsequent conformation of unauthorized acts. An agency is created where a person ratifies or adopts the act of another who without the principal’s knowledge and authority acted as his agent.Ratification is in law equivalent to previous authority it may be expressed or it may be affected impliedly by conduct. Section 196 and 197 of the act show that an act done by person who is not authorized to do it, but who purports to act as an agent for another person, can retrospectively ratified by such other person. From this it follows logically, that such an act on the part of the person purporting to act as agent is not void but voidable. If it is not ratified it becomes void but if it is ratified it will be validated
Where acts are done by one person on behalf of other person, but without his knowledge or authority, but without his knowledge or authority, he may elect to ratify or to disown such acts. If he ratifies them, the same effects will follow as if they had been performed by his authority as given in section 196. However, in order that a person may be able to validly ratify an unauthorized act, the rules of valid ratification must be observed.
The doctrine of ratification comes into play when a person has done an act on behalf of another without his knowledge or consent. The doctrine gives the person on whose behalf the act is done an option either to adopt the act by ratification or to disown it. So, it can be derived that ratifications are either empress or implied. The former are made in express and direct terms of assent; the latter are such as the law presumes from the acts of the principal.
For example: A, without authority, buys goods for B. Afterwards B sells them to C on his own account: B’s conduct implies a ratification of the purchase made for him by A.
ESSENTIALS OF RATIFICATION
- In doctrine of ratification, agent shall not be acting for himself, but shall be intending to bind a named or ascertainable principal
- It has retrospective effect. By ratification, the person becomes an agent with retrospective effect i.e. the acts are accepted from the time when the agent entered into contract
- There is privity of contract between the principal and the third party.
- Once the act is ratified it will have the same effect as if the act had been performed under the authority of the principal.
EFFECT OF RATIFICATION
Right of person asto acts done for him without his authority. Effect of ratification:
Section 196 says where acts are done by one person on behalf of another, but without his knowledge or authority, he may elect to ratify or to disown such acts. If he ratify them, the same effects will follow as if they had been performed by his authority.
RATIFICATION MAY BE EXPRESS OR IMPLIED
Ratification may be expressed or may be implied in the conduct of the person on whose behalf the acts are done. A general rule says that, the principal has the right to elect whether he will adopt the unauthorized act or not. But once doing a ratified act, upon a full knowledge of all the material circumstances, the ratification cannot be revoked or recalled, and the principal becomes bound as if he had originally authorized the act. So, the ratification of a lawful contract has a retrospective effect on the subject, and binds the principal from its date, and not only from the time of the ratification, but for the ratification is equivalent to an original authority, according to the maxim, that Omnis ratihabitio mandate aeguiparatur.
KNOWLEDGE REQUISITE FOR VALID RATIFICATION
No valid ratification can be made by a person whose knowledge of the facts of the case is materially defective.
A general rule of this subject, the principal has the right to elect whether he will adopt the unauthorized act or not. But once doing a ratified act, upon a full knowledge of all the material circumstances, the ratification cannot be revoked or recalled, and the principal becomes bound as if he had originally authorized the act. So, the ratification of a lawful contract has a retrospective effect on the subject, and binds the principal from its date, and not only from the time of the ratification, but for the ratification is equivalent to an original authority, according to the maxim, that Omnis ratihabitio mandate aeguiparatur.
The ratification must be voluntary, deliberate, and intelligent, and the party must know that without it, he would not be bound to fulfil the obligation.
EFFECT OF RATIFYING UNAUTHORIZED ACT FORMING PART OF TRANSACTION
Section 199 says that a person ratifying any unauthorized act done on his behalf ratifies the whole of the transaction of which such act formed a part
RATIFICATION OF UNAUTHORIZED ACT CANNOT INJURE THIRD PERSON:
Section 200 of the Indian Contract Act says that an act done by one person on behalf of another, without such other person’s authority, which, if done with authority would have the effect of subjecting a third person to damages, or of terminating any right or interest of a third person, cannot, by ratification, be made to have such effect.
CONDITIONS FOR VALID RATIFICATION
- Act must be done on behalf of another:
The first essential to the doctrine of ratification, with its necessary consequence of relating back, is that the agent shall not be acting of himself, but shall be intending to bind a named or ascertainable principal. The agent must have done the act on the behalf of the supposed principal. And the motive with which the act done is immaterial.
- Person ratifying must have been in existence at the time of act.-
It has been laid down that ratification, in order to be effective, can only be by an authority that is in existence on the date the transaction was entered into and it should also be competent to ratify.
- The thing must exist-
In order to recognize or ratify something it is necessary that thing must exist,That is the contract, or some rights or obligations arising under it, must be subsisting on the date of Ratification.
- Ratification must be with full knowledge of all facts.
In order to establish case of ratification it is essential that the party ratifying should be conscious.
- Act to be ratified must not be void or illegal. An act which is void or illegal cannot be validated by any amount of ratifications
- There must be relationship of principal and agent.
- Ratification to be exercised within reasonable time