What is ratification of a contract under German law?
Often times, our clients are being asked to subsequently allow a legal act that was done on their behalf in Germany. This can be done through ratification (Genehmigung).
Ratification is typically needed when there are formal requirements for the validity of a contract, such as regarding the sale of company shares or of real estate.
We offer the drafting, notarisation and legalisation of ratification documents and assist in liaising with the receiving parties. To this end, we profit from our expertise and experience with German law and our considerable network of legal professionals all over Germany.
Why do I need to ratify a German contract?
Under German law, if a contract is formed on behalf of a third party by an agent without authority (Vertreter ohne Vertretungsmacht or falsus procurator), its validity depends on the principal’s ratification (s. 177 I of the German Civil Code). This option is not available in relation to unilateral legal acts (s. 181) such as the cancellation of a contract of service.
Until ratified, the contract’s validity is considered to be pending (schwebende Wirksamkeit). The principal is free to reject ratification, which leads to the annulation of the contract.
The other contracting party may formally request ratification from the principal (s. 177 II 2). If no decision is made within two weeks, this is interpreted as an implied rejection (s. 177 II 2).
An example of where ratification might be needed is in Anglo-German property sales and purchases. Giving oral instructions to relatives or other agents regarding the sale of a property does not satisfy the formal requirements of s. 29 I of the German Land Registration Rules (Grundbuchordnung). Any type of assent will need to be contained in a notarial document, usually taking the form of a notarised ratification.
How do I ratify a contract if I’m in the UK?
In order to ratify one of the above-mentioned transactions, a German-language ratification document needs to be drafted or provided by the German recipient (usually a notary). After having been given all documents relating to the transaction in question, we are able to advise you on the implications of a possible ratification. Should translations be required, then we can arrange for this in a timely matter and at competitive rates.
After the document has been signed, we take care of every further step necessary to achieve completion. Besides notarisation, we are also able to organise legalisation by means of a Hague apostille. The Foreign and Commonwealth Office offers two services for having a document apostilled, a one-week (£30) and a one-day service (£75).
Our notaries are very experienced with the requirements of their German colleagues and of German registrars. As such, we are able to provide quick and efficient assistance with time-sensitive and complex real estate and share transactions.
Contact us today to discuss how we can help or click here to find out more about the services we offer for the German-speaking market.