What’s the meaning of ‘ultra vires’?
Dear Mirror Lawyer, Last week I heard some politicians discussing some issues and one said what they wanted to be done will be “ultra vires”.
What does that mean?
Nii Ashrifi, Accra.
Dear Ashrifi, The 1992 Constitution and Acts of Parliament such as the Companies Act deal with the doctrine of ultra vires.
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In order to protect shareholders and third parties dealing with the company, the courts have held that a company incorporated under the Companies Act is incorporated by Parliament for the objects stated in its Regulation.
Thus, it has power only to carry out such objects and anything else which is reasonably incidental thereto.
For example, a company formed to manufacture cars is expected to do just that and cannot go and enter into contract or borrow money for the purposes of manufacturing airplanes.
If an act is performed or a transaction carried out, which though legal in itself, is not authorised by the objects in the regulations, it is ultra vires, i.e. beyond the powers of the company and void.
Ultra vires is a Latin phrase which means beyond the powers.
When used in law, it refers to an activity which exceeds one’s power or an activity which is outside the authority or power of the person engaging in that activity.
When an officer or body is acting within its powers he is said to be acting intra vires.
This implies the act requires legal authority and it is done with such authority.
When it is outside its powers the act is ultra vires.
As used by lawyers and judges, acts that are intra vires are "valid" and those that are ultra vires are "invalid".
In the case of ASHBURY RAILWAY CARRIAGE CO. LTD. VRS. RICHE [1875], a company was formed with the object of carrying a business as mechanical engineers and general contractors.
The Directors, however, purchased the right to construct a railway in Belgium and entered into a contract with Riche whereby he would build the railway.
This agreement was ratified by all the shareholders.
The company then ran into difficulties and terminated the contract.
Riche sued for breach of contract.
It was held by the House of Lords that the contract was ultra vires by the company and void, so that not even the subsequent assent by the whole body of shareholders could ratify it.
Similarly, under the 1992 Constitution, there are certain acts such as declaring a one party state or retroactive legislation which are prohibited.
Any attempt by Parliament or any other person or body to undertake such prohibited acts shall be ultra vires their powers and declared by the court as null and void.