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The Borvigilant [2003]

Owners of the Borvigilant v Owners of the Romina G [2003]

Facts

  • The claimant’s tug collided with the defendant’s oil tanker
  • The claimant claimed the benefit of an indemnity to cover damage to his tug

Issue

  • Did the defendant’s agent have the authority to provide the indemnity

Decision

  • Yes

Reasoning

  • Either implied actual authority, or ratification
  • Ratification will be barred (allowed on facts) where it unfairly prejudices a third party
  • Lord Clarke adopted Bowstead and Reynolds’ submission that:

    “Ratification is not effective where to permit it would unfairly prejudice a third party, and in particular—

    (1) where it is essential to the validity of an act that it should be done within a certain time, the act cannot be ratified after the expiration of that time, to the prejudice of any third party;

    (2) the ratification of a contract can only be relied on by the principal if effected within a time after the act ratified was done which is reasonable in all the circumstances.”

  • Usually, where proprietary rights are at stake, ratification will not be permitted, although this is not an unqualified right
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