This document discusses key concepts relating to agency law. It defines an agency relationship as one where an agent is authorized to represent a principal and establish contractual relations with third parties. The essential elements of agency include agreement between principal and agent, competence of the principal, and intention to create contractual obligations. An agent acts on behalf of the principal, while the principal is the person for whom acts are done. The document outlines duties and rights of both agents and principals, and how agency may be created expressly or impliedly. It also discusses the extent of an agent's authority and the positions of principal and agent in contracts with third parties where the principal is named, unnamed, or undisclosed.

1. Vishisht school of management
Topic – agency
From - RAKESH SHARMA

2. MEANING OF AGENCY
• AN AGENCY IS THE RELATION BETWEEN AN
AGENT AND HIS PRINCIPAL CREAED BY AN
EXPRESS OR IMPLIED AGREEMENT WHEREBY
AN AGENT IS AUTHORISED BY REPRESENT HIM
AND ESTABLISH CONTRACTUAL RELATION
WITH THIRD PARTIES

3. ESSENTIALS OF AGENCY
• NAME OF A RELATION
• AGREEMENT , NOT NECESSARILY A CONTRACT
• COMPETENCE OF THE PRINCIPAL
• CONSIDERATION NOT NECESSARY
• FREE CONSENT
• INTENTION TO CRAETE CONTRACTUAL
RELATIONS
• OTHER ESSENTIALS

4. AGENT
• AN ‘AGENT’ IS A PERSON EMPLOYED TO DO
ANY ACT FOR ANOTHER OR TO REPRESENT
ANOTHER IN DEALINGS WITH THIRD PERSON.
[SEC. 182 ]

5. WHO MAY BE AN AGENT
AS BETWEEN THE PRINCIPAL AND THIRD PERSON, ANY
PERSON MAY BECOME AN AGENT. [SEC. 184] EVEN A
MINOR OR A PERSON OF UNSOUND MIND CAN BE
APPOINTED AS AN AGENT. THE REASON IS THAT THE
AGENCY MAY BE CREATED BY AN AGREEMENT BUT NOT
NECESSARILY BY A CONTRACT.HOWEVER, THE
APPOINTMENT OF A MINOR OR A PERSON OF UNSOUND
MIND AS AN AGENT HAS SERIOUS CONSEQUENCES. THEY
ARE :
1. SUCH AGENT IS NOT RESPONSIBLE TO HIS PRINCIPAL FOR
HIS WRONGFUL ACTS OR ACT DONE BEYOND AUTHORITY.
2. THE PRINCIPAL REMAINS LIABLE TO THE THIRD PARTIES
FOR ALL THE ACTS DONE ON HIS BEHALF BY SUCH AN
AGENT.

6. PRINCIPAL
• THE PERSON FOR WHOM SUCH ACT IS DONE ,
OR WHO REPRESENTED , IS CALLED THE
‘PRINCIPAL’ . [SEC. 182 ]

7. WHO MAY BE AN PRINCIPAL
• ANY PERSON , WHO IS COMPETENT TO ACT FOR HIMSELF ,
MAY BECOME A PRINCIPAL. THEREFORE , ANY PERSON WHO
IS OF THE AGE OF MAJORITY AND WHO IS OF SOUND MIND
MAY EMPLOY AGENT . [SEC. 183] THUS, A MINOR , LUNATIC
OR OTHER PERSON OF UNSOUND MIND CANNOT EMPLOY AN
AGENT.

8. RULES OF AGENCY
• WHAT A PERSON CAN DO HIMSELF , CAN GET
DONE TROUGH AN AGENT
• WHATEVER A PERSON DOES TAROUGH
ANOTHER , DOES BY HIMSELF

9. CREATION OF AGENCY
• AGENCY BY EXPRESS AGREEMENT OR
AUTHORITY.
• AGENCY BY IMPLIED AGREEMENT OR AUTHORITY.
THIS INCLUDES THE FOLLOWING TYPES OF
AGENCY
1. AGENCY BY ESTOPPEL.
2. AGENCY BY HOLDING OUT.
3. AGENCY BY NECESSITY.
4. AGENCY BY RATIFICATION.
5. AGENCY BY OPERATION OF LAW.

10. DUTIES OF AGENT
• TO CONDUCT BUSINESS ACCORDING TO HE DIRECTIONS GIVEN BY THE
PRINCIPAL
• TO CONDUCT THE BUNIESS WITH SKILL AND DILIGENCE
• TO COMPENSATE FOR NEGLECT, MISCONDUCT
ETC .
• TO RENDER PROPER ACCOUNTS
• TO COMMUNICATE WITH PRINCIPAL
• NOT TO DEAL ON HIS OWN ACCOUNT WITHOUT PRINCIPAL CONSENT
• TO PAY SAM RECCIVED FOR PRINICIAL
• TO PROTECT AND PRESERVE INTERESTS ENTRUSTED TO HIM
• NOT TO DELEGATE AUTHORTY
• NOT TO SET UP ADVERSE TITLE

11. RIGHTS OF AGENT
• RIGHT OF RETAINER
• RIGHT TO RECEIVE REMUNRATION
• RIGHT TO LIEN
• RIGHT TO BE INDEMNIFIED AGAINST
CONSEQUENCES OF LAWFULL
• RIGHT TO COMPENSATION
• RIGHT TO STOPPAGE IN TRASIT

12. DUTIES OF PRINCIPAL
• DUTIES OF PRINCIPAL TO HIS AGENT
1. TO PAY REMUNRATION TO HIS AGENT.(SECS.219-220)
2. TO INDEMNIFY THE AGENT AGAINST THE CONSEQUENCESOF ACTS DONE IN
GOODS (SEC.223)
3. TO INDEMNIFY THE AGENT IN RESPECT OF INJURY CAUESD BY HIS NEGLECT OR
WANT OF SKILL.(SEC.225)
4. TO INDEMNIFY THE AGENT AGAINST THE CONSEQUENCESOF ACTS.(SEC.222)
• DUTIES OF RINCIPAL OF THIRD PRATIE
1. TO BE BOUND BY ALL ACT OF THE AGENT ACTING WITHING THE SCOPE OF HIS
AUTHORITY .(SES. 226 227 228 237 238 )
2. TO BE BOUND BY MISREPRASENTATION OR FRAUD OF HIS AGRENT IN THE
COURES OF HIS EMPLOYMENT.(SEC.238)
3. TO BE BOUND BY NOTICE GIVEN TO THE AGENT.(SEC. 229)
4. TO BE RESPOMNSIBLE FOR CONTRACTS ENTERED INTO BY AGENT THOUGH HIS
NAME IS NOT DISCLOSED . [SEC. 223, 224]

13. RIGHTS OF THE PRINCIPAL
• TO DIRECT THE AGENT FOR THE CONDUCT OF
HIS BUSINESS. [SEC.211]
• TO DEMAND PROPER ACCOUNTS OF THE
BUSINESSS OF AGENCY . [SEC.213]
• TO CLAIM ALL SUMS RECEIVED BY THE AGENT ON
HIS BEHALF . [SEC.217]
• TO EMPOWER HIS AGENT TO NAME
SUBSIYTUTED AGENT.[SEC.194]
• TO EMPOWER HIS AGENT TO EMPLOY SUB-
AGENT .[SEC.190]

14. EXTENT OF AGENTS AUTHORITY :
IN ORDER TO BIND THE PRINCIPAL BY THE ACTS
OF AN AGENT, IT BECOMES ESSENTIAL TO
KNOW THE SCOPE OR EXTEND OF AGENT’S
AUTHORITY. THE EXTEND OF AGENT’S
AUTHORITY MAY BE DETERMINED BY THE
FOLLOWING :
1. ACTUAL OR AUTHORITY.
2. OSTENSIBLE OR APPARENT AUTHORITY
3. AUTHORITY IN EMERGENCY

15. POSITION OF PRINICIPAL AND AGENT
THE POSITION OF PRINCIPAL AS REGARDS TO THE CONTRACTS
ENTERED INTO BY TH EAGENT WITH THIRD PARTIES MAY BE
DISCUSSED UNDER THE FOLLOWING HEADS :
I. WHERE THE PRINCIPAL IS NAMED , I.E. WHERE BOTH THE
EXISTENCE AND THE NAME OF PRINCIPAL ARE DISCLOSED
BY THE AGENT.
II. WHERE THE PRINCIPAL IS UNNAMED ,I.E. WHEREE ONLY THE
EXSITENCE OF THE PRINCIAL IS DICLOSED BUT NOT HIS NAME.
III. WHERE THE PRINCIPAL IS UNDISCLOSED ,I.E. WHERE BNOTH THE
EXISTENCE AND NAME OF THE PRINCPAL ARE NOT DISCLOSED

16. WHERE THE PRINCIAL IS NAMED :
GENERALLY, AN AGENT DISCLOESD THE EXISTENCE AND
NAME OF HIS PRINCIAL . THE POSITION OF SUCH A
NAMED PRINICIPAL AS REGARD TO THE CONTRACTS
MADE BY HIS AGENT WILL BE AS FOLLOWS:
1. ACTS OF AENT WITHIN HIS AUTHORITY
• IF THE ACT DONE PROFESSEDLY N BEHALF OF THE
PRINCIPAL.
• IF THE ACT IS WITHIN THE SCOE OF HIS ACTUAL OR
APPRENT AUTHORITY
• IF THE ACT DONE IS IN THE COURES OF EMPLOYMENT
OF THE AGENT , AND
• IF THE ACTS ARE LAWFULL

17. 2. ACTS OF AN AGENT BEYOND AUTHORITRY
• WHERE WORK HIS SEPRABLE
• WHERE THE WORK HIS NOT SEPRABLE
3. NOTIES TO AGENT IS THE NOTIES TO THE
PRINCIPAL
4. PRINCIPAL INDUCING BELIEF HAT AGENTS
UNAUTHORISED ACTS WERE AUTHORISED
5. MISREPRESENTION OR FRUAD BY AGENT

18. WHERE THE PRINICIPAL IS UNNAMED
WHEN AN AGENT DISCLOSRD THAT HE IS ACTING
ON BEHALF OF HIS PRICIAL BUT DOES NOT
DISCLOSED THE PRINCIPAL’S NAME,
THE ACT WAS DONE ON BEHALF OF THE PRINCIPAL
THE ACT WAS WITHIN THE SCOPE OF HIS
AUTHORITY
THE UNNAMED PRINCIPAL EXISTED OR WAS
COMETENT TO CONTRACT AT THE TIME OF
DOING THE ACT.

19. WHERE THE PRINCIPAL IS
UNDISCLOSED
1. POSITION OF THE UNDISCLOSED PRINCIPAL
• WHEN THE THIRD PARTIE DISCOVERS THE
PRINCIPAL
• WHEN THE PRINCIPAL HIM SELF INTERVENES
2. POSITION OF AGENT
3. POSITION OF THIRD PARTIE