What must occur for ratification to bind the principal?

• A. The agent informs the principal of his actions and the principal accepts.
• B. The agent's actions are approved by a court.
• C. The principal must immediately sign a new contract.
• D. The agent's actions must be enforceable by law.

Answer: (A)

Ratification binds the principal when the principal becomes aware of an actor’s actions and elects to accept them. The essential steps are that the agent informs the principal of what was done, and the principal accepts or affirms the act, showing clear intent to be bound by it. Once accepted, the relation is treated as if the principal had authorized the act from the beginning, giving the contract retroactive effect.

No court approval is required for ratification, and there’s no need to sign a new contract—the acceptance itself creates the binding obligation. The legality or enforceability of the act isn’t the condition for ratification; if the act were illegal, ratification wouldn’t make it valid.