You are on page 1of 3


Put agency into Sale of Goods / floating charge PQ

If you have a case of actual authority, it is valid
If Watteau v Fenwick style situation:
o Undisclosed principal cannot sue TP unless he ratifies the contract

Nature of authority and nature of agency two competing theories

- Theoretical basis: consent to something, therefore youve got a
- Apparent authority estoppel argument:
o Firmly entrenched
o But: look at the requirements of conventional estoppel and see if
we really do fulfil these requirements
Classic estoppel: (1) representation, usually weak and general;
(2) reliance, needs detriment? Thats not really true. In
promissory estoppel, you only need a change of position.
Proprietary estoppel, Henry v Henry detriment arises when
you forgo an easier life; argument, we take speculative
detriments, but this is a very weak form of detriment. The
plaintiff obtains a carefully tailored remedy (reliance basedcf
Australian authorities). Minimum equity to do justice.
If we look through the requirements, no need to give the
remedy that is expected. But here, in principal and agent
situation, the third party gets the remedy he wanted.
Krebs article he has a problem with Watteau v Fenwick
But both parties should be able to sue
But the undisclosed principal cannot ratify the contract
Ireland v Livingston
- Q: why do we have an indulgence for this rule?
- In 18th century: no way of checking if the agent is acting reasonably
- But in these days, you can easily check it with advanced technology
Freeman v Lockyer
- The four requirements for apparent authority
Q: third party reliance should be protected more? But in the end it is
always open for the third party to check things in the world of advanced
^Think about nemo dat as well
First Energy
- Reasoning: X fit well with Armagas, a radical departure
- BUT: result is right but doctrinally it is a bit odd
- Goes back to who should bear the burden of checking

- Retrospective authority
- Cant ratify where it causes unfair prejudice
- Bolton v Lambert: on retrospective effect
- Two things that come up in PQs:
o Principal has to be in existence at the time the contract is entered
into (Braymist: agent may be able to enforce the contract himself)
o Keighly
Undisclosed principal cannot ratify the contract
Undisclosed principals are anomalous
Dont add the two anomalies together
Who can sue and be sued

Usual authority
- Dubious
- No actual or apparent authority
Treitel vicarious liability
- Basis of vicarious liability: no one really knows its scope and
justification; uncertain
- T: when it comes to economic torts, we have very strict narrow rules
Cohen practical grounds
- Collusion
Tettenborn estoppel
- Represented that theres this person running the business
- Problem:
o Estoppel cant find a cause of action???
**Perhaps the law of unjust enrichment??
Ratification(staying within the realm of agency)
- Keighly.. criticise this
Said v Butt
- Breach of warranty of authority
- Strict liability
- Consideration:
o The fact that the third party enters into a contract with a principal