43 ; Here Willes, j., said ; " The principle by which a person,

on whose behalf an act is done without his authorit}'',

may ratify and adopt it, is as old as any proposition known

to the law. But it is subject to one condition : in order to

make it binding, it must be, either with full knowledge of

the character of the act adopted, or with the intention to

adopt it at all events, and under whatever circumstances."

Marsh v. Joseph (1897), 1 Ch. 213. C.A., & 75 L. T. 558 ;

here Lord Russell, C.J,, delivering the judgment of the

Court of Appeal, said ; " To constitute a binding adoption

of acts a priori unauthorized, these conditions must exist —

(i.) The acts must have been done for and in the name

of the supposed principal ; and

(ii.) There must be full knowledge of what those acts

were, or such an unqualified adoption that the inference may

properly be drawn that the principal intended to take upon

himself the responsibility for such acts, whatever they were."

(c) The principal on whose behalf an unauthorized agent

acts must be in existence at the time the act is done. This

14 The law of agency.

rule is of great importance in regard to contracts made on

behalf of projected companies.

KcliUT V. Baxter <b others (1866), L. R. 2 C. P. 174 ;

here Baxter and two others, being among the promoters of

a company (viz. The Gravesend Royal Alexander Hotel

Company) not yet in existence, entered into certain contracts

as its agent and in its name, expecting that the company,

when it came into existence, would adopt and ratify these

contracts ; the company did do so, but subsequently became

bankrupt, and the Court held that Baxter and the others

were personally liable upon the said contracts. Willes, J.,

In giving judgment, said ; " Ratification can only be by a

person ascertained at the time of the act done — by a person

In existence either actually, or in contemplation of law ;

as in the case of assignees of bankrupts, and administrators,

whose title, for the protection of the estate, vests by

relation."

The principle laid down in Kelner v. Baxter, uhl supra,

was affirmed in Melhado v. Porto Alegree RaiUvay Coinpaiiy

(1874), L. R. 9 C. P. 503, Re Empress Engineering Com-

pany (1881), 16 Ch. D. 128. C. A., & In re Northumberland

Avenue Hotel (1886), :^3 Ch. D. 16. C. A.

But though a company cannot, after its formation, ratify

a contract which was made before it came into existence,

It can of course after its formation make a new contract to

the same effect as the old one — vide the judgment of Jessel,

M.R., in Re Empress Engineering Company, uhi supra, and

of Lopes, L.J., in In re Northumberland Avenue Hotel,

ubi supra.

(d) The act of an unauthorized agent must be one that

Is lawful in itself, and one that the principal at the time of

ratification is himself legally capable of doing.

Brook v. Hoo/.: (1871), L. R. 6 Ex. 8!) ; here it was held

that an act which was, in its inception, illegal and void,

could not be subsequently ratified.

FORMATION OF AGENCY. 15

La Banque Jacques-Cartier v. La Banque d'Epargne

(1887), 13 App. Cas. Ill ; here it was laid down by the

Privy Council ; " Acquiescence and ratification must be

founded on a full knowledge of the facts, and further, it

must be in relation to a transaction which may be valid