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Bullock v. State - 966 P.2d 1215 (Utah Ct. App. 1998)

Rule:

Under Utah law, affirmance by a principal of a contract made on his behalf by one who had at the time neither actual nor apparent authority constitutes a ratification which is as effectual as an original authorization. Ratification of an agent's acts relates back to the time the unauthorized act occurred and is sufficient to create the relationship of principal and agent. 

Facts:

Plaintiff Richard B. Bullock and the individual defendants ("Co-partners") were partners in a partnership that owned land in Provo canyon. The Provo canyon property was the sole asset of the partnership. Under an agreement, the Provo canyon property could be sold only with the consent of all the partners. Bullock did not consent to the sale of property to defendant State of Utah Department of Transportation ("UDOT"), but he endorsed and negotiated the check for his share of the proceeds from the sale. In March 1993, one year after the title transfer and six months after Booker accepted payment for the sale, he served notice of suit against defendant State of Utah. In May 1994, appellant filed suit in federal court against UDOT and the Co-partners, but that case was dismissed in Nov. 1994. In March 1996, Bullock filed a lawsuit against the State, UDOT and the Co-partners in Utah state court. On defendants' motions, the trial court dismissed Booker's claims against the State as untimely. The trial court also dismissed his suit against the Co-partners, concluding that Booker had ratified the sale. Booker appealed, contending that his claim under the Utah Governmental Immunity Act, Utah Code Ann. §§ 63-30-1 to 38 (1997), was not time barred and that he did not ratify the Co-partners' actions.

Issue:

Did Bullock impliedly ratify the Co-partners' unauthorized sale of the partnership's property when he endorsed and negotiated the check?

Answer:

Yes.

Conclusion:

The court of appeals affirmed the trial court's judgment. The court held that Bullock’s action against UDOT was barred by the one-year statute of limitations under Utah Code Ann. § 63-30-12 (1997) because it was a claim for recovery of property under Utah Code Ann. § 63-30-6 (1997), not a claim for breach of contract. The court held that Bullock's third party beneficiary claim against UDOT failed because he alleged a breach of the partnership agreement but not a breach of the sales agreement. The court held that the claim against the Co-partners was properly dismissed because Bullock impliedly ratified the unauthorized sale when he negotiated the check, and his conduct prior to the suit indicated he consented to the sale. The court held that Bullock’s ratification released the Co-partners from liability for their breach of the partnership agreement.

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