What is meant by the term "ratification" in agency law?

In agency law, "ratification" refers to the process by which a principal approves or validates actions taken by an agent that were not authorized at the time they were performed. When an agent acts outside the scope of their authority, the principal has the option to either accept or reject those actions. If the principal chooses to approve the unauthorized actions, this express consent constitutes ratification.

This concept is essential because it allows the principal to affirm the agent's actions, thus binding themselves to any legal consequences that arise from those actions. Ratification can occur explicitly, where the principal communicates their approval, or implicitly, through conduct that indicates acceptance of the actions (such as accepting the benefits of the agent's actions).

The other options do not accurately define ratification: cancellation of an agent's actions implies rejection rather than approval, refusal suggests non-acknowledgment, and delegation pertains to transferring authority rather than retroactive approval of actions taken without prior authorization.