agency Flashcards
(32 cards)
def agency
used in legal context refers to relationship usually created by contract in terms of which the principle instructs the agent to act on his behalf to produce legally binding contracts for the principal
mandate
if the contract is gratuitous then the relationship is usually known as mandate/ mandatory
creation of contract agency
governed by a contract of agency could be express s.1 ROWA 1995 or orally
can also be implied principal infer concent.
or ratification can be used
capacity of the agent
because the agent is simply acting as intermediary lack of capacity may not be important
capacity of the principal
principal enters into contacts with 3rd party. agent = intermediary as a result the principal must have contractual capacity.
tinevally sugar refining co v mirelees Watson &yaryan co ltd
example of the promotor purporting to act on behalf of a company not yet formed. companies act s.51
express authority
aurthority may be stipulated in contract
implied authority
if the contract is silent as to the extent of the authority, the agent has implied authority to do whatever is necessary and incidental to the completion of transaction. custom and usage of the trade may help to define scope.
can only apply to GENERAL agents not SPECIAL.
general agents
appointed to carry out all the business of the principal or all of the principals business of a particular kind. the fact that an agent is general allows third party to assume that the agent possesses the authority.
special agents
carry out a specific task.
apparent or ostensible authority
acting without authority. a legal relationship between the principal and contractor created by a rep. made by the principal to the contractor, intended to be acted on by the contractor. the agent has authority to enter on behalf of the principal in to a contract of a kind within the scope of apparent authority so as to render the principal liable to perform any obl imposed on him by such contract.
freeman and lockyer v Buckhurst park properties (mangal) ltd
agency by holding out. this arises either when a principal takes no steps to contradict the impression that an individual is agent or + encourages that impression. if a third party relies on that impression, it would be unfair of the principal to reverse that impression, particularly in the meantime the third party has acted to his detriment. in other words if the principal acts in a manner which suggests to the thirds that the agent is authorised the principal cannot there after seek to deny that the agent is properly authorised
armagas ltd v mundogas
ruled that where agent is known to have no general authority to enter into transactions but agent falsely represented to the third party that he had obtained from principal specific authority to enter into a one off transaction, principal would not be bound by agent’s action.
first energy ltd v Hungarian international bank ltd
it suggests that although the agent may not be entitled to rep the extent of his or her own authority, he may be authorised to communicate info on behalf of the principal. such info may include the fact that the agent is authorised to carry out a specific transaction.
Kelly v fraser
it suggests that although the agent may not be entitled to rep the extent of his or her own authority, he may be authorised to communicate info on behalf of the principal. such info may include the fact that the agent is authorised to carry out a specific transaction. = as a rep by the agent as to the extent of his own authority.
factors act 1889 ss1-2
where no prior authority has been given, the acts of the agent may be ratified by the principal
ratification may operate on two different level:
the agent may be authorised to do certain acts but exceed his or her authority. ratification VALIDATES the actions carried out in excess of his/ her authority
OR
ther may be no valid agency relationship but agent purports to act for a specific principal in this situation ratification creates an AGENCY relationship
Tinevelly sugar refining co v mirrlees Watson & yaryan co ltd
rectification is effective if certain conditions are fulfilled the principal must have been in existance at the time the agent purported to enter into the contract on the principals behalf. s51 CA covers promotors purporting to enter into a preincorp contracts for a company.
boston deep sea fishing v farnham
Ratification: the principal must have the requiste legal capacity to enter into the contract at the time the agent purported to enterinto the contract on the principals behalf. alexander ward &co confirms this
keighly maxed v durant
ratification: the agent must act as an agent and must have intimated to a third party that he was acting as agent and not on his own account.
goodall v bilsland
RATIFICATION: relevance of time limits and nature of ratification. effective ratification binds the principal in a contract with the 3rd party from the moment the agent purported to enter into the contract with the third party as though the agent had been properly authorised from that moment.
but where done within a certain time limit and the agent carries it out within this time limit subsequent rat by the principal = INAFFECTIVE
N/B English law recognises ratification after a third party purported to withdraw (Bolton partners v lambert)
forman& co pty v the Liddesdale
the principal in ratifying must make an informed choice
gray v baird logistics
ratification may not be possible if it would cause unfair prejudice to a third party.
frank houlgate investment company v biggart baillie llp
BREACH OF WARRANTY OF AUTHORITY. an agent who does not possess authority and negotiates a contract between principle and 3rd party may be liable to the THIRD party for breaching his warranty of authority. where an agent acts without authority and THIRD party has contract he did not think he had breach of warrenty is available = damages are avaliable
stewart v shannessy
AGENTS ACT FOR A DISCLOSED PRINCIPAL. contract created between the principal and 3rd party though medium of agent. agent is not a party to the contract and should not incur liabilities. General principle must be considered in the light of the presumption that a party signing a written contract is BOUND.
