Ratification of agent’s contracts
If an agent acts outside his actual authority, the principal can ratify the contract and become bound by it. That is, if A purports to act for B without B’s knowledge, then providing A states himself to be an agent for B, B can ratify and adopt the contract. But ratification cannot be used to introduce a stranger to a contract: if A contracts with C on a private basis, B cannot claim afterwards that A was acting as his agent. When a contract is ratified, rights and obligations are related back to when the contract was made. If the agent is acting within his apparent authority and has been held out by the principal as his agent, ratification is not necessary.
Reference: The Penguin Business Dictionary , 3rd edt.