Saturday, 17 December Posted by Muhammad Atif Saeed Contract of Agency According to Section an agent is a person employed to do any act for other or to represent another in the dealings with the third persons. The function of an agent is essentially to bring about contractual relationship between the principal and third parties. Essentials of relationship of agency. There are two essentials of the relationship of agency:
Scott v Davis 2. Christie v Permewan Whatever a person has capacity to do, they may do through an agent: Bevan v Webb Principal is an infant An infant can appoint an agent to do whatever they themselves could lawfully do: Watkins v Vince If agent is an infant: An infant can bind a principal: Goode v Harrison The infant must have sufficient capacity to understand the nature of the agency and give its consent to act: A principal will be bound by the agent s actions if the agent was acting within the scope of their authority: International Harvester Co Whether an agency arises is a question of law, approached objectively: Implied Ostensible authority Ratification Agency imposed by law4.
Toll v Alphapharm Actual authority requires the express or implied consent of the principal Keighley maxted co v durant agent: Poulet Frais Whether an act is within the agent s express authority depends on construction of the terms of any instructions given by the plaintiff: Tobin v Broadbent Toll v Alphapharm: Alphapharm was distributor for vaccines in Australia and agreed that Richard Thomas Pty Ltd would look after collection and storage of vaccines.
Was RT acting as Alphapharm s agent when it signed the exclusion clause? On the terms of the contract, Alphapharm expressly authorised RT Pty Ltd to agree upon rates of freight, terms of payment and other standard terms of freight contracts. Was the act within the scope of Alphapharm s authority?
The exclusion clause was a standard term so RT had acted within its authority. Fray v Voules Actual authority can be implied in a number of circumstances: Hely-Hutchinson v Brayhead If managing director, authority impliedly includes: From Hely-Hutchinson v Brayhead: Employing others to provide services to the company Guaranteeing loans made to the subsidiary of the company Agreeing to indemnify other guarantorsFrom Crabtree-Vickers v ADMA: Borrowing money and giving security over the company s property Authorising agents to enter into contracts on behalf of the companyIf ordinary director: May be impliedly authorised to carry out formal functions of the company such as executing documents on behalf of the company but whether these documents themselves are binding usually depends on authorisation by the board: Northside Developments If real-estate agent, authority impliedly includes: Finding a purchaser, but not making a binding agreement with a purchaser: Making contracts on behalf of a client: Nowrani v Brown Receiving revocation of an offer: Hely-Hutchinson v Brayhead If agent is a director with a history of not seeking board sanction: The board allowed Mr Richards to enter contracts without the sanction of the board over an extended period of time.
Mr Richards had actual implied authority to enter contracts with Mr Hely-Hutchinson of Perdio Electronics by virtue of the board s prior acquiescence. If agent ignores approval process when contracting: Although the agent probably took advice from his superior on aspects of proposed agreements, he usually entered into such contracts without any approval process being followed because of his greater depth of knowledge and experience in the area.
If agent steals money: Agent had implied authority on the basis of a number of prior dealings to receive the net proceeds of a loan for the purpose of applying them to investments agreed upon between the principal and agent.
The fact that the agent fraudulently misappropriated those funds is irrelevant. Crabtree-Vickers Ostensible authority is founded on estoppel and does not depend on an agreement between the principal and agent: Northside Developments Ostensible authority has three elements: Rama Corporation v Proved Tin: Robinson v Tyson Robinson v Tyson:Keighley Maxted & co v Durant: A wife agreed to sell her husband’s house to the plaintiff.
She did not have any authority to do this and so at this stage the contract was not binding on the husband. Rowtor Steamship Co Ltd  2 AC , HL M Golodetz & Co Inc v. Czarnikow-Rionda Co Inc, The Galatia  1 WLR , CA MacWilliam Co Inc v.
Mediterranean Shipping Co SA, The Rafaela S  3 All ER Martineaus Ltd v. Keighley, Maxsted & Co v Durant  AC Chapter 5.
Relevant facts. Keighley, Maxsted and Co (‘KMC’) authorised an agent, Roberts, to buy wheat on a joint account for him and them at a certain price. Roberts was unable to buy wheat at the price he was authorised to do so for KMC. On 11 May , he contracted with. Keighley, Maxsted & Co v Durant  AC Chapter 5.
Relevant facts. Keighley, Maxsted and Co (‘KMC’) authorised an agent, Roberts, to buy wheat on a joint account for him and them at a certain price. Roberts was unable to buy wheat at the price he was authorised to do so for KMC.
On 11 May , he contracted with. PURPORTING TO ACT FOR P General: ‐ A must have purported to act for P (Byas v Miller) -‐ Undisclosed principal cannot ratify (Trident General Insurance v McNiece) Identity of P: ‐ Keighley, Maxted & Co v Durant o A authorised to buy wheat at a lower price.
In Keighley, Maxted & Co v Durant (), A was authorized by P to buy wheat at 44s 3d a quarter on a joint account for A and P. Wheat was unobtainable at this price and, therefore, A agreed to buy from T at 44s 6d a quarter.