Ratification Deed – Giving Legal Approval After the Fact
What is a Ratification Deed?
A Ratification Deed is a legal document that confirms, approves, and validates an act or agreement that was originally performed without the necessary authority. Once executed, the earlier act is treated as if it had been authorised from the beginning (retrospective effect).
When is it Used?
- Property transactions: Sale/lease executed without a proper Power of Attorney or written consent.
- Business contracts: A director, partner, or employee signs without prior approval; the board/partners later confirm.
- Partnership/family arrangements: Acts done by one person later approved by all concerned.
Why is Ratification Important?
Without ratification, an unauthorised act may be unenforceable and invite disputes. Ratification brings legal certainty, protects parties, and reduces litigation risk by validating the past act.
Key Elements & Clauses
- Parties: The ratifying party (Principal) and the person who acted (Agent/Authorised Person).
- Recitals: Clear background of what happened, when, and why ratification is needed.
- Ratification Statement: An explicit clause confirming and approving the earlier act.
- Confirmation of Rights & Obligations: Declare the act valid and binding between the parties from the original date.
- Indemnity (optional): To protect the ratifying party from losses arising from the unauthorised act.
- Execution Details: Date, place, witnesses, and, where applicable, notarisation/registration.
Quick Example
Your friend sells your bike while you are away, without your authority. Initially, that sale is not valid against you. If you later execute a Ratification Deed approving the sale, the transaction becomes binding as if you had authorised it on the original date.
FAQs
Does ratification always relate back to the original date?
Yes—if validly done, ratification generally operates retrospectively. However, it cannot prejudice rights of third parties who acquired interests in the meantime without notice.
Is stamping/registration required?
Requirements vary by state and the nature/value of the underlying transaction. Consult local stamp and registration laws to ensure compliance.
Can a company ratify without a board resolution?
Company ratification should typically be supported by a proper board/shareholder resolution as per the company’s articles and law.
What if the Principal lacked capacity on the original date?
Ratification is ineffective if the Principal did not have legal capacity to authorise that act at the time it was done.
Copy-Paste Clause (Sample)
The Principal hereby confirms, approves, and ratifies the act/transaction described in the Recitals above, and declares that the same shall be valid, binding, and effective between the parties as if expressly authorised on the date it was originally performed.
No comments:
Post a Comment