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Flashcards in Law of Agency Deck (8)
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Definition of an Agent

Give Ewan McKendrick definition of an Agent

“He is the authorised voice of one party (his principal) to act on his behalf in dealings with some third party” - Ewan McKendrick: Goode on Commercial Law 2010.


How is authority bestowed on an agent?

Generally the agent will have authority given to him by his principal, but it is possible for it to be implied by the position held by the agent.


Types of Authority

Define the three type of Authority

Express Authority: The Principal gives the Agent clear instructions to do something.

Ostensible / Apparent Authority: This occurs where the agent holds himself out as having some authority on behalf of the Principal

Implied / Customary Authority: Generally an agent in a recognised position in a particular market may well have “implied” or “customary” authority within that market activity.


What is the leading case on Implied Authority?

Watteau v Fenwick (1893) - regarding the liability of an undisclosed principal.


How Agency is Created

Name three methods

Expressly created

Through neccissity (i.e. through crisis)

Through ratification (This can be express or implied by conduct but is only effective if the Principal had a choice in the matter and was in full knowledge of the facts)


Name the leading cases on creation of Agency

Agency of necessity:
Great Northern Railway v Swaffield (1874); it must be impossible to get instructions from the principal.

Ratified retroactively.
Cornwal v Wilson (1750) [Ratification by conduct].


Duties of the Agent

List the 6 duties of the Agent

The duties of the Agent are similar to the duties of Directors under the Companies Act 2006 S.171-177. Broadly they are:

a) To carry out the instructions of the Principal
b) To act with due care and skill
c) A fiduciary duty (good faith)
d) Not to put himself in a position where his personal interests and agency duties conflict
e) Not to take bribes or make secret profits (IDC v Cooley (1972)
f) Must not delegate his duties without express permission from the Principal


Rights of the Agent

List the 5 rights of the Agent

Mandate (i.e. contract)