Legal basis: Civil Law
Article 171 Where an actor has no agency, exceeds the agency or remains an agent after the agency is terminated, it shall not be effective to the principal without ratification by the principal.
The counterpart may urge the principal to ratify it within 30 days from the date of receiving the notice. If the trustor fails to declare it, it shall be deemed as refusal to ratify it. Before the act committed by the actor is ratified, the bona fide counterpart has the right to revoke it. Revocation shall be made by notice.
If the act committed by the actor is not ratified, the bona fide counterpart has the right to demand the actor to perform the debt or demand the actor to compensate for the damage he has suffered. However, the scope of compensation shall not exceed the benefits that the counterpart can obtain when the principal ratifies.
If the counterpart knows or should know that the actor has no right to act as an agent, the counterpart and the actor shall bear the responsibility according to their respective faults.
Article 503 Where an unauthorized agent enters into a contract in the name of the principal, and the principal has started to perform the contractual obligations or accepted the performance of the other party, it shall be deemed as ratification of the contract.
Article 504 A contract concluded by the legal representative of a legal person or the person in charge of an unincorporated organization exceeds its authority, unless the other party knows or should know that it has exceeded its authority, the representative's behavior is valid, and the contract concluded is valid for the legal person or unincorporated organization.