Something that is ultra vires is done without the proper authority or power. If the CEO of a company sells a large part of the company`s assets without consulting the shareholders, it is an ultra-vires action. In British constitutional law, ultra vires describes patents, regulations and other regulations issued under the prerogatives of the Crown that contradict laws passed by the Crown in Parliament. Almost scandalous in modern times, the ultra-vires actions of the Crown or its servants were previously a major threat to the rule of law. Under constitutional law, particularly in Canada and the United States, constitutions confer various powers on the federal, provincial or state governments. To get out of these powers would be ultra vires; For example, although the Court did not use this term to introduce federal law in United States v. Lopez, on the grounds that she had exceeded the constitutional authority of Congress, the Supreme Court still declared the law ultra vires. [10] Companies have a variety of legal documents and policies that define the parameters authorized by each organization, its employees and directors. These documents may contain a “Memorandum of Association”.
The memorandum is widely used in Europe, but not in the United States. Ultra vires means “beyond the forces”. It is used to describe an action that requires legal authority or power, but is then performed externally or without the requested authority. With regard to companies, “ultra vires” means an act or transaction of a company which, although not illegal or contrary to public policy, when performed by an individual, nevertheless goes beyond the legitimate powers of the company as defined in the law under which it was incorporated or in the laws applicable to it, or by its constitution, although the scope of the ultra-vires doctrine, as it applies to businesses and corporations, is now limited by law. Ultra vires acts are all actions that escape the authority of a company. Ultra vires actions do not fall within the powers expressly set out in a charter or company law. This may also apply to any action expressly prohibited by the Company Charter. In accordance with Section 15.2 of the Irish Constitution, the Oireachtas (Parliament) is the sole legislative body of the Republic of Ireland. However, in CityView Press v. AnCo, the Irish Supreme Court has held that the Oireachtas may delegate certain powers by primary law to subordinate bodies, provided that such delegates only authorise the delegate to promote the principles and policies established by the Oireachtas in primary law and not to develop new principles or policies themselves. Any primary law which confers on a body other than the Oireachtas the power to make public order is unconstitutional; However, since there is a presumption in Irish constitutional law that the Oireachtas acts within the limits of the Constitution, any legislation passed by the Oireachtas must be interpreted as constitutionally valid to the extent possible.
When individuals within a company use resources that go beyond their legal jurisdiction, this can be called ultra vires. These actions may include the appropriation of income from the company or shares of the company in which the persons do not have legal ownership. If a manager accessed the company`s bank accounts and used those assets for personal needs, this would be classified as ultra vires acts. If an accountant or other tax officer within a company has transferred ownership of the company`s shares, they have rights of control, this also falls under ultra vires laws. The term is not appropriate in relation to an act or transaction that is outside the legitimate powers of a person. Thus, the term is used in two senses: • Going beyond the powers of directors within the framework of the powers conferred on them by the company or its articles of association In administrative law, an act of ultra vires in the narrow or broad sense may be subject to judicial review. There are narrow ultra vires when a director did not have substantial decision-making power or when he was vitiated by procedural defects. There is an abuse of authority (e.g., Wednesbury`s unreasonableness or bad faith) or a failure to exercise administrative discretion (e.g., acting at the request of another or unlawfully enforcing government policy) or the application of discretionary powers in an irrational and erroneous manner. [11] Both doctrines may give rise to various privileges, equitable remedies or legislative orders if they are respected. Ultra vires (Latin: “beyond powers”) is a Latin term used in law to describe an action that requires legal authority but occurs without it.
Its opposite, an act committed under the right authority, is intra vires (“in the powers”). Actions that are intra vires can be called equivalently “valid” and those that are ultra vires can be called “invalid”. In company law, ultra vires describes actions attempted by a company that go beyond the scope of the powers conferred by the company`s object clause, its articles of association, articles of association, similar incorporation documents or laws authorizing the incorporation of a company.
