Unauthorised representation

Unauthorised representation is called when the representative performs transactions on behalf of the represented although he/she is not authorised to do so. The represented person or the representative does not have to be at fault for the existence of unauthorised representation. Deficiency in the element of authorisation in the transactions performed on behalf of the representative is lack of authority to represent, exceeding the limit of authority to represent and termination of authority to represent. With this, although there is no real lack of authority, in some cases, the provisions regarding unauthorized representation may be applied by analogy to the extent that they comply with their qualifications. These situations, which are the appearance forms of unauthorised representation that is not real; abuse of the representative's power of representation, self-dealing, acting on behalf of both parties, representation of a person who does not exist, and unused authority. Suspended void transactions performed without the authorisation of representation, becomes effective retroactively with the consent of the person represented. However, the legislator has introduced certain regulations in order to protect bona fide third party and to ensure the security of the transaction in case of the fault of the represented person or the representative. The scope of the protection in the said provisions is realised in the form of full or partial protection of the goodwill of the third party. If there is no provision protecting the good faith of the third party, the transaction becomes null and void from the beginning if the represented party fails to approve the transaction. In this case, the unauthorised representative shall be liable to compensate the negative damages of the good faith third party. However, if the unauthorised representative is at fault and equity requires, the third party may also claim compensation for positive damages.