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Ratification in Agency Without Knowledge of Material Fact, 15 Yale Law Journal 331 (1906)

Abstract

The question for discussion is whether in cases of agency by

ratification the doctrine that notice to the agent is notice to the

principal has any application. Some of the general principles from

which the argument is to proceed may be set forth in a few sentences.

Where one without the semblance of authority assumes to

act as the agent of another, that other may ratify the act and thereby

acquire the rights and assume the obligations that would have

been his had the agent's assumed authority been actual. In like

manner, where an agent, whose authority is limited, acts on his

principal's behalf beyond the scope of that authority, the principal's

subsequent ratification is, in most respects at least, equivalent to

actual prior authority. Further, where an agent is acting for his

principal, within the scope of his authority, notice to or knowledge

possessed by the agent, germane to the subject matter of the agency

and affecting the execution of the agency, will with some exceptions

be deemed to be notice to or the knowledge of the principal.

This knowledge must have been acquired by the agent while he

was acting as such; or, if acquired previously, must have been actually

present in the agent's mind during the execution of his

agency, and it must have been knowledge which he was at liberty

to disclose to his principal. In cases where the knowledge of the

agent is relied upon to affect the validity or the consequences of

action on the part of the principal himself, the communication of

such knowledge must have been within the scope of the agent's

duty and there must have been an opportunity, in the exercise of

reasonable diligence, to communicate such knowledge to the principal

before he acted. Neither in cases where the agent is acting

nor in cases where the principal is acting will notice to the agent

be deemed notice to the principal where it is known to be to the

agent's own interest to conceal his knowledge from his principal,

or where he is known to be violating his duty and is acting in fraud

of or contrary to the interest of his principal.

Date of Authorship for this Version

1906

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