Agency

AGENCY

Sec.182 defines—an “agent” is a person employed to do any act for another, or to represent another in dealing with third persons.

“Principal” is a person for whom such act is done, or who is so represented.

Delhi Electric Supply Undertaking v. Basanthi Devi & another

KINDS OF AGENCY

Mercantile agents and Factors; Auctioneers; Brokers; Delcredere Agents

Couturier Vs. Hastie Non –mercantile agents

CREATION OF AGENCY

Express Agency; Implied Agency or doctrine of Holding

Out (which is species of Estoppel) Freeman & Lockeyer

Vs. Buckhurst park properties; Pickering Vs. Busk; Kashinath Das Vs. Nisakar Rout

Agency by Necessity; Sims& Company Vs. Midland Railway Co.; Great Northern Railaway Co. Vs. Swafield; Matheson Vs. Smiley;

Agency by Ratification .

DOCTRINE OF RATIFICATION

Sec.196-----Ratification is a kind of affirmation of unauthorized acts

ESSENTIAL OF RATIFICATION

The act Ratified must have been done for the person Ratifying;

Keighley Vs. Durant; The person Ratifying must have been in

existence; The person Ratifying must be competent to

have authorised the Act; The Act Ratified must not be void or illegal; It must take place within a reasonable

time;

Sec.197---Ratification may be expressed or implied;

Sec.198---Ratifier must have full knowledge of facts;

Sec.199---Whole transaction should be ratified;

Sec.200---Ratification should not cause injury to the third person;

Doctrine of Relation Back Bolton Partners Vs. Lambert; Watson Vs. Davies

DUTIES OF AGENT

Sec.211---Duty to follow Instructions or Customs;**Pannalal Janaki das Vs. Mohan Lal**Lilley Vs.Doubleday;**Ferrer Vs. Robinson;**Solomon vs. Barker;Sec.212—Duty of reasonable care and skill:**Keppel Vs.Wheeler

Sec.213---Duty to maintain accounts; Ramlal Vs. Asian commercial Insurance Sec.214—Duty to communicate with principal; Gwilliam Vs. Twist Sec.215& 216—Duty not to deal on his own

account; **De Busche Vs. Alt; Duty not to make secret profit; **Andrews Vs. Ramsay & Co Duty to maintain secrecy; Duty not to set up adverse title;

Duty to protect and preserve the interests of the principal in case of his death ,insanity or insolvency;

Sec.218—Duty to pay over monies; Sec.190—Duty not to delegate;

A engage B, an auctioneer to sell some property on the terms that he should receive his due commission of Rs.500. B, however received secretly Rs. 200 as commission from the purchaser. Discuss the rights of A and B.

A, enters into a contract with B for buying B’s car as agent for C without his authority. B repudiates the contract before C comes to know of it. C subsequently ratifies the contract and sues to enforce it. Advise B.

DELEGATUS NON POTEST DELEGARE Sec.190--- An agent cannot lawfully

employ another to perform acts which he has expressly or impliedly undertaken to perform personally unless by the ordinary custom of trade a sub-agent may, or, from the nature of agency, a sub-agent must, be employed.

EXCEPTIONS

Where the ordinary custom of trade permits; Where the nature of work is such that a sub-

agent is necessary; Where the agent has express authority to

appoint sub-agent; Where unforeseen emergencies arise rendering

appointment of a sub-agent necessary; Where the act to be done is purely ministerial

not involving confidence or the use of discretion;

Where the principal knows that the agents intend to appoint a sub-agent.

SUB-AGENT

Sec.191---A sub-agent is a person appointed by agent and works under the authority of agent.

UOI Vs. Mohd.Nazim Sec.192 --- Proper sub-agency

(Representation of principal by sub-agent);

Sec.193 --- Improper sub-agency;

SUBSTITUTED AGENT

Sec.194 --- Where an agent holding an express or implied authority to name another person to act for his principal, names another person accordingly, he is not a sub-agent but a substituted agent for the principal.

Sec.195---Agent’s duty in naming such person.

Rights of Agent

Sec.217– Right of retainer; Sec.219—Right to remuneration; Sheikh Farid Baksh Vs. Hargulal Singh Green Vs. Barlett; Tribe Vs. Taylorn( indirect or remotely

connected to agency services) ***[Exception Sec.220 -- Andrews Vs.

Ramsay&Co] Sec.221--- Right of Lien; Sec.222--- Right to be indemnified against

consequences of lawful acts;

Sec.223--- Right to be indemnified against consequences of acts done in good faith;

***[Exception Sec.224] Sec.225---Right to compensation

Rights of Principal

To seek for damages; To ask for an account; To resist the claim of the agent.

RELATIONS OF PRINCIPAL WITH THIRD PARTIES

The position of a principal and his agent as regards contracts made by the agent with third parties may be discussed under the following heads:

(a) where the principal is named; (b) where the principal is unnamed; (c) where the principal is

undisclosed.

NAMED PRINCIPAL

EFFECTS: 1.Acts of the agent are the acts of the principal

(Sec.226); Extent of agent’s authority: (a). Actual or real authority; or

***Ryan Vs. Pilkington***Dingle Vs. Hare (according to the custom and usage of a

particular trade);***Robinson Vs. Mollet (the custom or usage must not be

unlawful or unreasonable); (b). Ostensible or apparent authority;

***Watteau Vs. Fenwick ( When the agent’s act was within the scope of his authority it is deemed to be that the act appeared to be authorized

2. principal inducing belief that agent’s unauthorized acts were authorized & agent’s authority in emergency (Sec237 & Sec.189);-- These are statutory provisions of doctrine of ostensible authority.

3. when the agent exceeds his authority(Sec.227 & 228):

Bains Vs. Ewing; 4. Notice given to agent as notice to principal

(Sec.229); Bawden Vs. The London etc. Insurance Co. 5.Misrepresentation or fraud of agent (Sec.238); ***Fuller Vs Wilson ***Lloyd Vs.Grace Smith&Co.

Agent acting for an unnamed principal;

[Where the agent does not disclose the name of his principal, but discloses his own representative character].

The contract will be the contract of principal and the same legal consequences applies.

Agent acting for an undisclosed principal(Sec.231):

[where the agent neither discloses the existence of the principal nor his representative character].

An undisclosed principal can sue or be sued on a contract made in the name of another persons with (t)his authority.

Contractual obligations of the parties in case Of Undisclosed PrincipalSec.231---The rights of the parties to a

contract made by an agent for the undisclosed principal.

SEC.232---Performance of contract with agent supposed to be principal

The position of parties to a contract can be discussed under the following heads:

(a)The position of Principal;(b)The position of Agent;(c) The position of third parties;`

PERSONAL LIABILITY OF AGENT (Sec.230) When the contract expressly provides; When the agent acts for a foreign

principal; When he acts for an undisclosed

principal; When he acts for a principal who

cannot be sued; Where he sign a contract in his own

name;

Where he acts for a principal not in existence;

where he acts as a pretended agent ; Where he receives or pays money by

mistake or fraud ; Where he is liable for breach of warranty

of authority; Collins V. Wright Where his authority is coupled with

interest;