Legal Definitions - Ultra vires

Ultra vires is a legal term meaning "beyond the powers." It describes actions taken by an entity – such as a government body or a corporation – that exceed the scope of authority granted to it by law, its constitution, or its corporate charter.

When an action is deemed ultra vires, it means the entity did not have the legal capacity or authorization to perform that act. Such actions may be considered invalid or unenforceable because they fall outside the boundaries of the entity's legitimate authority.

Examples:

• Example 1: A City Council's Unauthorized Tax

  A small city's municipal charter grants its city council the power to levy taxes for public services like road maintenance, schools, and sanitation. The council decides to impose a special tax on all residents to fund the construction of a private, for-profit sports arena, arguing it will boost local tourism.

  This action would be considered ultra vires because the city council's authority to tax is limited to public services as defined in its charter. Funding a private, for-profit venture, even if intended to benefit the city indirectly, falls "beyond the powers" explicitly granted to it by law.

• Example 2: A Non-Profit Organization's Commercial Venture

  A charitable foundation is established with a corporate charter explicitly stating its purpose is to provide scholarships for underprivileged students pursuing higher education. The foundation's board of directors decides to use a significant portion of its endowment to purchase and operate a chain of commercial coffee shops, believing the profits will eventually fund more scholarships.

  This action would be considered ultra vires because the foundation's corporate charter strictly defines its purpose as educational scholarships. Operating a commercial coffee shop chain, regardless of the ultimate financial goal, goes "beyond the powers" and stated mission outlined in its foundational documents.