Agency

1. Agency According to Sec 182 of the Contract Act, ‘ An agent is a person employed to do any act for another or to represent another in dealings with third persons. The person for whom such act is done, or who is represented, is called the principal.’ The contract which creates the relationship of principal and agent is called an ‘agency’.

2. Contract of Agency "Agent" and "principal" defined  An "agent" is a person employed to do any 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 "principal". [Sec 182] Who may employ agent  Any person who is of the age of majority according to the law to which he is subject, and who is of sound mind, may employ an agent. [Sec 183] Who may be an agent  As between the principal and third persons, any person may become an agent, but no person who is not of the age of majority and sound mind can become an agent, so as to be responsible to the principal according to the provisions in that behalf herein contained. [ Sec 184] Agent and Servant: direct supervision and control

3. Essential and valid legal rule for a valid Agency There should be an agreement between the principal and agent The agent must act in representative capacity Principal must be competent The agent need not be competent

4. Kinds of agent

5. Classification of Agents Sub –agent Agent agent is sub agent ex- A appoint B as his agent and B also appoint C his agent , in this case C is sub –agent Substituted agent-

6. Contract of Agency Duties of Agent : To conduct the business of agency according to principal’s direction. Conduct the business with skill and diligence that is generally possessed by persons engaged in similar business. To render proper accounts In case of difficulty to communicate with the principal. Not to make any secret profits . Not entitled to remuneration for business mis -conducted. Not to disclose confidential information. Protection of interests entrusted to him in case of termination of agency in because of death or of becoming of unsound mind of the principal.

7. Contract of Agency Termination of Agency: By revocation by principal On the expiry of fixed period of time On the performance of the specific purpose In the event of insanity or death of the principal or agent In the event of the insolvency of the principal By renunciation of agency by the agent