What Does Ratify Mean in Contract Law?

Key Takeaways

• Ratification means giving legal approval to a contract that may otherwise be voidable or unauthorized.
• It can occur through explicit actions (like signing or voting) or implied conduct (such as making payments under the contract).
• Once ratified, the contract becomes binding as if it had been valid from the start.
• Ratification requires intent, knowledge of all material facts, and voluntary agreement.
• Common contexts include real estate deals, corporate governance, agency law, and international treaties.
• Failing to ratify can leave contracts unenforceable, but partial ratification is not allowed—you must accept the entire agreement.

What does it mean to ratify a contract? A business owner may want more than just a signed contract to bind an agreement. For instance, if an employee signs a document instead of you, the other party may want the document to be ratified to confirm you accept the terms.

If there's a signed contract but there are valid reasons to void it, ratifying it will show the contract can continue in force. Even if you ratify a contract, you have choices to refuse or invalidate it instead. Make sure to look over the agreement to understand the words and conditions. If you choose to ratify the document, you have to ratify it entirely, not just some terms.

How to Ratify a Contract

It's important to be clear about what you're agreeing to before ratifying a contract. Accepting the terms has to be either an expressed or implied declaration. Expressing that you want to keep the contract valid is done through writing or verbally. If there is no obvious expression but you continue to follow the contract terms, such as continuing payments, this is an implied declaration.

• When you ratify a contract, you are bound legally and are liable for a breach of the contract.
• Ratification makes the contract binding on the date the document is signed, not just the date it is ratified.
• If the company is a corporation, you also have to present your choices to stockholders for voting.
• The state law and corporate charter will determine what needs to be signed and which decisions need to be made for the owners to ratify them.
• Ratification is valid if it's intentional, voluntary, and done with the knowledge of the circumstances of the document.
• Refusing to ratify a document is also another option.

The moment the contract is ratified there are the steps that should be followed:

• Corresponding settlements
• Seller buying choice of home
• Buyer should have a gift-letter
• Third-party approval of the agreement
• Gathering the necessary number of parties of attorney
• Homeowner documents given to the buyer on time, and the buyer having these inspected on time.

Ratification Beyond Contracts

While often discussed in contract law, ratification is also significant in other legal contexts:

• Treaties and International Law: Governments ratify treaties to confirm formal acceptance, making them legally binding on the nation.
• Agency Law: A principal can ratify an agent’s actions, even if those actions were initially outside the agent’s authority.
• Employment Agreements: Employers may ratify agreements made by managers on behalf of the company.
• Everyday Transactions: Simple actions like paying for goods ordered without authorization can amount to ratification.

Understanding these applications broadens the meaning of “what does ratify mean” in practice—it’s not limited to contracts but extends to governance, diplomacy, and daily business operations.

Ratification in Business and Corporate Settings

In business law, ratification often arises when:

• Agents or Employees Act Without Authority: A company can ratify agreements made by employees who exceeded their authority, binding the business as though the action had been authorized from the start.
• Corporate Governance: Board members or shareholders may ratify unauthorized acts of officers to avoid disputes or legal challenges.
• Startups and Entrepreneurs: Founders sometimes sign agreements before the company is formally established. Once incorporated, the company can ratify those contracts so they become enforceable.

This process protects businesses from invalidating beneficial deals while ensuring accountability for unauthorized actions.

Requirements for Valid Ratification

For a ratification to be legally enforceable, certain conditions must be met:

• Capacity: The party ratifying must have had the legal capacity to enter into the agreement both at the time of the original signing and at the time of ratification.
• Knowledge: Ratification must be made with full knowledge of all material facts surrounding the contract.
• Intent: The party must clearly intend to affirm the contract, either through written confirmation, verbal acknowledgment, or conduct consistent with acceptance.
• Entire Agreement: A contract must be ratified in full—partial approval is not valid in law.

These requirements ensure that ratification is deliberate and not the result of mistake or coercion.

What Does Ratified Mean?

When you are buying a house, ratification of the contract begins when all of the parties have agreed to the contract terms in writing. This is when everyone is committed and will follow the terms of the contract.

If you are a buyer, anyone else can negotiate with the seller up to being ratified, so it's important to have your contract ratified so that both parties are committed to each other. As a buyer, you will want to know the important deadlines like appraisals, home inspections, and financing. You have to make sure to meet the deadlines and keep with the dates to protect your interests in the contract.

Everyone has to sign off on everything within the contract and remove contingencies like inspections and sale of a home. During the escrow process, there are several documents that are required by law.

• Apply for a mortgage.
• File the documents and get them into escrow.
• The settlement company will do a title search and pay everyone.
• Your real estate agent will take all the documents to the other agent, who starts a case file and compiles information of those involved to pay everyone.
• Inspections are ordered depending on where you live in case any repairs have to be made and parties must agree on who will pay for them.
• Insurance has to be done for the new property.
• A homeowner's insurance policy has to be in place the day you settle in.
• The title insurance is also bought.
• It is important for buyers to understand what policy has been in place for the seller. There might be a discount if there is a transfer of policy instead of buying your own.
• Repairs should be ordered and supervised if needed for any termites, defects, or lead.
• Depending on the contract and law, the repairs will vary, as some houses sell "as-is" and if the buyer agrees to have no repairs done.
• Post-contract documents should be created, such as agreeing to settle in while the repairs are being done, or pre or post-settlement agreements.

Frequently Asked Questions

1. What does ratify mean in simple terms?
   To ratify means to approve or confirm an agreement, making it legally binding as though it had been valid from the start.
2. Can a contract be partially ratified?
   No. Ratification requires acceptance of the entire agreement; partial ratification is not legally valid.
3. What happens if a contract is not ratified?
   If not ratified, the contract may remain unenforceable or voidable, depending on the circumstances.
4. Is ratification only used in contract law?
   No. Ratification also applies to treaties, corporate governance, agency law, and even routine transactions.
5. Can a company ratify a contract signed before incorporation?
   Yes. Once incorporated, a company can adopt or ratify pre-incorporation contracts to make them enforceable against the company.

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