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ƠLaw of Agency is a contractual relationship

between two persons viz. created by an
agreement express or implied, the agent and the
principal.ơ
 S.182) ƛ is a person employed to do an
act for another or to represent another in
dealing with third persons.
The person for whom such act is done or who is so
represented is called the Ɲ  

The relationship so created is called the contract of

agency
 _ 

1. Whatever a person can do personally, he can

do it through an agent.
( : marriage, singing, painting etc.)

2. The act of an agent is the act of the principal.

The obligations arising from the acts of an
agent, are enforceable in same manner and
will have same legal consequences as if the
contracts entered into and the acts done by
the principal in person
   

   There must be relationship through an agreement

under which the agent represents his principal. The contract may
be 
  
The agent should be appointed by the principal
and confer authority to act for him.
     
Principal must be competent i.e., a
minor or person of unsound mind cannot appoint an agent,
otherwise the agent shall be personally liable.
 | !
Authority conferred should be such as will make the
principal answerable to third parties.
" #!$  : Is to establish relationship
between principal & his parties
%  Relationship of agency is based on confidence
between principal & the agent
&   May or may not exist in agency. (S.185)
' #Other conditions of a valid contract like free consent &
legality of object also necessary for agency
  

( 




a. By Express Agreement
b. By Implied Agreement
 )
_  
d. By Operation of Law

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ƥ Principal appoints agent !

,

ƥ A person gives 

   *-
express deed is created
ƥ Agents to execute deeds, grant/surrender leases, sign prospects
of a co. to act as proxy for a shareholder must be appointed by a
written deed
  

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ƥ Arising out of conduct of the parties
ƥ Inferred from circumstances
ƥ Partners, servants, wife are regarded as agents by implication by
their relationship
ƥ Principal will not be entitled limit the implied authority of the
agent without notice to the third party
( 
  

i) Agency by estoppel
ii) Agency by holding out
iii) Agency by necessity

. where a person leads willfully another person to believe

that a certain state of affairs exits and induces him to act on that
behalf so as to alter his previous position, he is estopped from
denying subsequently the fact of that state of affairs
  

* 
!

Agency by estoppel arises when a person is held out as an agent
a) even though he is actually not an agent, or b) after he ceased
to be an agent

*
!
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Where a person permits another by a long course of conduct to
pledge his credit for certain purposes: he is bound by the act of
such person in pledging his credit for similar purposes, without
the previous permission of his master. This is a case of agency by
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* 
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Agency by necessity is conferred by law in certain urgent
circumstances
Eg., In an emergency, a person protects the property or interest of
another which are in imminent danger and consent of the owner
cannot be obtained. In such cases the law assumes the consent
of the owner to the creation of agency. The person protecting
the property would be deemed to be an agent provided he acted
bonafide in the interest of the owner.

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Some times agency is implied by operation of law

Eg., U/S 18 & 19 of Indian Partnership Act, 1932, the partners of a firm
bind each other and the firm by their acts. 6  

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 ×
 7 (
A) On the extent of authority B) On nature of work C) Non-mercantile
# 

i) General Agent
ii) Special Agent
iii) Universal agent
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a. Factor
b. Broker
c. Auctioneer
d. Commission agent
e. Del credere agent
f. Banker
9- promoter, solicitor, wife, receiver,
insurance agent
 _
_    
1. Right to Receive Remuneration (S.219,220)
2. Right to Retainer (S.217)
3. Right to Lien (S.221)
4. Right to be indemnified (S.222)
5. Right to Compensation (S.225)
6. Right of Stoppage in Transit
7. Right to appoint Sub-agent or substituted Agent in
certain cases
8. Right to Compensation for Pre-mature Revocation of
Agency (S.205)
 ' 
'epends on nature of agency
1. Follow directions of Principal (S.211)
2. Conduct Business with reasonable Skill & 'eligence (S.212)
3. Render Proper Accounts to Principal (S.213)
4. Communicate with Principal in Case of 'ifficulty (S.214)
5. Not to 'eal on his Own Account (S.215)
6. Not to Make any Secret Profit (S.216)
7. Pay Sum Received for Principal (S.218)
8. Not to 'elegate Authority (S.190)
9. On Principalƞs 'eath or Insanity (S.205)
10. Not to Use Information Obtained in the Course of the
Agency against the Principal
11. Not to Set-up an Adverse Title
 '   
  *
1. To indemnify against all lawful (in exercise of
authority conferred) acts
2. To indemnify against acts done in good
faith/injury to 3rd person (S.223)
3. To indemnify for injury caused by principalƞs
neglect (S.225)
4. To pay commission & other remuneration
agreed
(However, where one person employs another to do an act
which is criminal, employer not liable to the agent, to
indemnify for consequences(S.224))
 _  
:    
1. To Recover Damages
2. To Obtain an Account of Secret Profits &
Recover Them and Resist a Claim for
Remuneration
(Contract with 3rd party is not rendered void)
3. To Resist Claim for Indemnify against Liability
Incurred
 6 

 )
  
i) By mutual agreement
ii) By Revocation by the Principal
iii) By Revocation by the Agent
 )
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i) By Performance or completion of Agency
ii) By Death or Insanity
iii) By Insolvency of the Principal
iv) By Expiry of Time
v) By Destruction of the Subject Matter
vi) By Dissolution of a Company
vii) By Principal or Agent becoming Alien Enemy