12 June 2015
A UK Court has found that an individual can be bound by the terms of a guarantee executed by an agent using a signature writing machine.
The case concerned Gordon Ramsay’s signature on a guarantee of a lease, which had been applied using a signature machine, by his father-in-law, Christopher Hutchinson. The guarantee provided that Mr Ramsay would be the guarantor of the annual rent under the lease. When the lease was assigned and Mr Ramsay was no longer the tenant of the property, he sought a declaration that he was not the guarantor of the annual rent, on the basis that he did not sign the guarantee.
In making its decision, the Court took into consideration the fact that Mr Hutchinson and Mr Ramsay had a long-standing business relationship for more than 20 years. During this period, Mr Ramsay entrusted Mr Hutchinson to act for him personally and his companies in relation to his business affairs. The Court determined that this trust was ‘very extensive, if not total’. The Court concluded that this was sufficient to find that Mr Hutchinson had been acting within the scope of the authority given to him by Mr Ramsay to act on his behalf. Therefore, Mr Ramsay remained as guarantor of the lease. The Court also ruled that Mr Ramsay was bound by the guarantee despite the absence of express authorisation to enter into it.
This case serves as a reminder to those who give authority to agents to act on their behalf to ensure that the parameters of that authority are clearly defined.