Course facilitator – Ms. Shilpi Gupta   1
AgencyGeneralIt is not always possible for a person to do everything himself, hence itbecomes necessary to delegate some o...
General rules of AgencyThere are two important general rules regarding agency, viz:What one person can himself lawfully do...
CREATION OF AGENCY ( Sec. 187) 1. By express agreement. 2. By implied agreement. 3. By ratification/approval. 4. By operat...
By express agreement An agency express agreement or authority arises when  authority is conferred on an agent either by w...
By Implied Agreement Implied agency inferred from the conduct or relation of the  parties or the circumstances of the cas...
By Ratification Agency by ratification arises when some act is done by a  person on behalf of another without his authori...
By operating Law Agency may also arise by operating of law. In such a  case, law presumes a person as an agent of another...
DUTIES OF AGENT1.   To carry out the work undertaken according to the directions given by the     principal.2.   To carry ...
RIGHTS OF AGENT1.   Right of retainer.2.   Right to receive remuneration.3.   Right of lien.4.   Right of indemnification....
TERMINATION OF AGENCYBy act of the parties                       By operation of law                                      ...
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Agency

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Agency

  1. 1. Course facilitator – Ms. Shilpi Gupta 1
  2. 2. AgencyGeneralIt is not always possible for a person to do everything himself, hence itbecomes necessary to delegate some of the acts to be performed byanother person. Such other person is called an agent.Definitions of Agent and PrincipalII An agent is a person employed to do any act for another or to representanother in dealings with third persons. The person for whom such act isdone, or who is represented, is called the principal" .85 The contractwhich creates the relationship of principal and agent is called anagency. For example: X appoints Y to buy ten bags of wheat on his behalf,X is the principal, Y is the agent and the contract between the two isagency. Course facilitator – Ms. Shilpi Gupta 2
  3. 3. General rules of AgencyThere are two important general rules regarding agency, viz:What one person can himself lawfully do, can as well get it done by any otherperson. This rule is of course, subject to some exceptions, e.g., in case, of actsrequired to be performed personally like marriage.What a person does by another, he does by himself. In other words the acts of theagent are, for all legal purposes, the acts of the principal.Who may employ an AgentAny person who is competent to contract may employ an agent. A minor or aperson of unsound mind cannot employ an agent."Who may be an AgentThe Act lays down that "as between the principal and third persons any personmay become an agent";" Thus even a minor or a person of unsound mind can beappointed as agent, but in such a case the principal shall be liable. Course facilitator – Ms. Shilpi Gupta 3
  4. 4. CREATION OF AGENCY ( Sec. 187) 1. By express agreement. 2. By implied agreement. 3. By ratification/approval. 4. By operation of law. Course facilitator – Ms. Shilpi Gupta
  5. 5. By express agreement An agency express agreement or authority arises when authority is conferred on an agent either by written or spoken words. Case A appoints b to manage his business by a written and stamped deed and B accepted it. It is an agency created by an express agreement between A & B. Course facilitator – Ms. Shilpi Gupta
  6. 6. By Implied Agreement Implied agency inferred from the conduct or relation of the parties or the circumstances of the case. Case A lives in Kolkata. He owns a shop in jaipur and visit occasionally. The shop is managed by B. B is in the habit of buying goods from C in the name of A for the purpose of shop, and paying from them out of A’s funds with A’s knowledge. B has an implied authority from A to buy goods from C in the name of A for the purposes of the shop Course facilitator – Ms. Shilpi Gupta
  7. 7. By Ratification Agency by ratification arises when some act is done by a person on behalf of another without his authority and act is ratified or affirmed by the other and unauthorised act become authorised Course facilitator – Ms. Shilpi Gupta
  8. 8. By operating Law Agency may also arise by operating of law. In such a case, law presumes a person as an agent of another. For instance ever partner is an agent of the firm, for the purpose of the business of the firm Course facilitator – Ms. Shilpi Gupta
  9. 9. DUTIES OF AGENT1. To carry out the work undertaken according to the directions given by the principal.2. To carry out the work with reasonable care, skill and diligence.3. To communicate with the principal in the case of difficulty.4. To pay sums received for the principal.5. To protect and preserve the interests of the principal in the case of his death or insolvency.6. Not to make secret profit from agency .7. Not to set up an adverse title.8. Not to use information obtained in the course of the agency against the principal. Course facilitator – Ms. Shilpi Gupta 4-
  10. 10. RIGHTS OF AGENT1. Right of retainer.2. Right to receive remuneration.3. Right of lien.4. Right of indemnification.5. Right of compensation. Course facilitator – Ms. Shilpi Gupta
  11. 11. TERMINATION OF AGENCYBy act of the parties By operation of law  Performance of the contract Agreement  Expiry of the time  Death of either party Revocation by the principal  Insanity of either party  Insolvency of either party  Destruction of the subject matter Revocation by the agent  Principal becoming an alien enemy  Dissolution of a company Course facilitator – Ms. Shilpi Gupta

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