Ratification: Useful but Uneven

European Journal of Private Law, Vol. 17, No. 6, Forthcoming

35 Pages Posted: 22 Sep 2009

Date Written: September, 21 2009

Abstract

Ratification permits a principal to determine to be bound by the legal consequences of action taken by an agent after the fact of the agent’s conduct when the principal would otherwise not be bound. By ratifying a principal may clarify the effects of uncertainty, furnishing reassurance to the agent, the third party with whom the agent dealt, and other parties interested in the status of the transaction. However, at the point the principal decides whether to ratify, the principal knows facts not known to agent and third party at the time of the agent’s unauthorized transaction, in particular subsequent developments in the market. The principal thus may be tempted to speculate at the expense of the third party, ratifying if the transaction seems then favorable to the principal and, if not, relying on the agent’s lack of authority. This article is a comparative analysis of ratification doctrine within the systems covered by "The Unauthorized Agent." Ratification doctrine is variable among these systems and, even within single systems, difficult to rationalize. The article argues that these doctrinal characteristics reflect tensions between two competing principles that underlie ratification - the necessity for the principal’s consent and considerations of fairness to third parties - leading to variations in doctrinal specifics. Ratification’s unevenness also reflects the complexity of consent within agency doctrine; system-by-system variations also stem from differences in the significance of ratification and the contexts in which the doctrine matters

Keywords: ratification doctrince, agency, consent, fairness, unauthorized agent

Suggested Citation

DeMott, Deborah, Ratification: Useful but Uneven (September, 21 2009). European Journal of Private Law, Vol. 17, No. 6, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1476361

Deborah DeMott (Contact Author)

Duke University School of Law ( email )

210 Science Drive
Box 90362
Durham, NC 27708
United States
919-613-7082 (Phone)
919-613-7231 (Fax)

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