Professional Documents
Culture Documents
Agency is a relation based upon express or implied agreement where by one person is known as agent and the other person is known as principal.
He has the authority to create He ordinarily has no such commercial relationship authority. between the principal & the third party
He may work for several He ordinarily work for only principal at a time. one master at a time. He usually get commission He usually get salary or wages.
FEATURES OF AGENCY
Intention to work for Principal No consideration is necessary Agreement between principal and agent
Kinds of Agents
General Agents
Special Agents
Universal Agents
Mercantile Agent
Non-Mercantile Agent
Wife
Banker Agent
CREATION OF AGENCY
Agency By Express Agreement Agency By Implied Agreement Agency By Ratification Agency By operation of Law
ratification is said to be arise when a person , on whose behalf the acts are done without his knowledge or authority, expressly or impliedly accept such acts.
ESSENTIALS OF RATIFICATION
Full knowledge (Sec198) Whole transaction (sec199) No damage to third party (Sec200) Act on behalf of other person Existence of principal Within reasonable time Lawful acts Acts within Principals power Communication
RIGHTS OF AN AGENT
Right
to claim reimbursement of expenses Right to receive remuneration Right to indemnification against consequences of all lawful acts. Right to indemnification against consequences of acts done in good faith. Right to indemnification injuries caused by principals neglect. Right of particular lien
DUTIES OF AN AGENT
Duty to act according to directions or custom of trade (sec211) Duty to act with reasonable care and skill (sec212) Duty to render account (sec213) Duty to communicate with principal and to obtain principals instructions (sec214)
DUTIES OF AN AGENT
Duty to disclose all material circumstances and to obtain the principals consent in dealings (sec215&216) Duty to pay sum received for principal (sec217&218) Duty to protect and preserve the interest entrusted to him (sec209) Duty not to delegate (sec190)
AUTHORITY OF AN AGENT
Lawful Acts Emergency Authority Ostensible Authority
the principal revoking his authority By the agent revoking the business of agency By the business of the agency is completed By the principal declared as insolvent By mutual agreement On death or on becoming of unsound mind of principal or agent On expiry of fixed period
PRACTICAL PROBLEMS
X the principal , instructed Y his agent to insure the goods . Y failed to do so and the goods are destroyed by the fire. Is Y liable to X ?