CHANG YI WEI

18WBR08583
Question 2

If Tomas is the agent of Charles, would your answer differ? Discuss the duties of
an agent towards its principal.

If Tomas act as an agent to Charles, Tomos owed a duty to comply with Charles’s
instructions unless the instruction from Charles are unlawful as according to Section
164 CA 1950 (Goode, 2004). An agent must follow the principal’s instructions where
the instructions are clear . An agent will be liable for any losses suffered by the
principal if he fail to obey the principal’s instructions. In this case, Tomas is in breach
of contract as he enter into a contract on behalf of Charles without any instructions
from Charles. As a result, Tomas will be personally liable for RM 500,000.00

According to Section 167 CA 1950, an agent also owed a duty to communicate to

the principal with all reasonable diligence (Contracts Act 1950, 2006). An agent must,
before enter into a contract, try to communicate with his principal to get instructions
unless in the case of emergency. In this case, Tomas does not communicate with his
principal, Charles, before he enter into the contract. As a result, Tomas is said to be
breach of contract and liable for the loss suffered by Charles.

Goode, R. (2004). Commercial law. 3rd ed. London: LexisNexis.

Contracts Act 1950. (2006). Kuala Lumpur: Percetakan Nasional Malaysia Bhd.