TABLE OF CONTENTS

1. INTRODUCTION

1.1 MEANING OF AGENT

1.2 MEANIN G OF SERVANT

2. MAIN BODY

2.1 SIMILARITIES OF AGENT AND SERVANT

2.2 DIFFERENCE BETWEEN AGENT AND SERVANT

3. CONCLUSSION

4. REFERENCE
1. INTRODUCTION

1.1 MEANING OF AGENT

Agent is a person employed to do any act for another or to represent another in dealing with third

party or person. The person for whom such act is done or represented is called principal (under

section 134 of the law of contract act cap 345) for a person to act on behalf of another person

there must be a contractual relationship that binds them which is called ‘contract of agency’.

Agent has a right to be paid remuneration for the act done by him.

Agency is a relationship. By this is means that the parties are so related to each other that certain

mutual rights and duties spring up which never existed before the creation of the relationship.

This relationship exists between one person called the principal and another called the agent.

This relationship gives to the agent the power to represent and act for the principal, in dealings

with third persons. This needs no further comment than to say that so long as the agent acts

within the scope of his authority the rights and liabilities of the principal are the same as if he

himself had conducted a given transaction

An agent can be special, general or universal, depend on their agreement. An agent is said to be

special when he employed to do all acts connected with particular business or employment.

General agent can bind the principal by doing things which fall within his authority or fall within

the scope of the ordinary business. An agent is said to be special when he is employed to do

some particular act or to represent his principal in particular activities or transaction, as soon as

the act performed the authority of such an agent come to an end. Agent can be universal when

his authority is unlimited, that is he is authorized to do all the acts, which the principal can
lawfully do. He can delegate powers to other agent and he enjoys extensive power to transact

every kind of business on behalf of his principal. Under the contract of agency, an agent is

required or authorized to establish privities of contract between principal (his employer) and

third party.

1.2 MEANING OF SERVANT

Servant is one who employed to render personal service to his employer otherwise in pursuit of

an independent calling and who in such service remains entirely under the control and direction

of the employer who is called master. A servant and master relationship arise out of an express

contract or by conduct; there will be no contract between master and servant unless both are

consent to it. Servant can be the one employed by government known as civil servant employee

as household. Servant can enter into agreement without compensation, but in absence of

agreement master must pay servant at the agreed rate. Employer can not delay payment of salary

or wages or substitute something other than money unless the employee assents. The word

"servant" seems to have in law two meanings. One is that which it has in common used, when it

indicates a person hired by another for wages, to work for him as he may direct.

We may call such a person a servant in fact; but the word is also used in many cases to indicate a

servant by construction of law; it is sometimes applied to any person employed by another, and

is scarcely to be discriminated in these instances from the word " agent. "
2. MAIN BODY

2.1 SIMILARITIES OF AGENT AND SERVANT

Agent and servant are synonymous in the sense that they look similar but not the same in the

following point by starting with similarities

Both work on behalf of another person, both servant and agent perform their act on behalf of

another person. Both are employed to assist their employer in doing certain activities which

employers think it’s necessary to have an assistant. Both serve the interest of their employers by

performing their duty in good faith. The basement of forming the duty of agent and servant

depend on the activities conducted by their employer who is either a master on a principal.

They follow instruction from their employer, both an agent and servant follow the instruction

from their employers on what to do. Information regarding on their duties and responsibilities

that form the basis of their employment, agent and servant are required to follow every

instruction which are on the basis of legal nature in order to serve the interest of their employer

since they work on behalf of him.

They work under free consent, both work under their free will, they are not forced to enter into

agreement with their employers, since the law of the contract act requires any person who enter

into a contract, there must be free consent of the parties, this means that the agreement between

parties should not being influenced by coercion, undue influence or fraud.

They are paid remuneration, both agent and servant perform their act for remuneration, agent

performs for commission basis and servant is paid salary or wages. Servant can be paid at regular

interval and agent receive his commission after completing his act
2.2 DIFFERENCE BETWEEN AN AGENT AND SERVANT

Difference in the number of persons they work on behalf at a particular period.

An agent has ability to work on behalf of more than one principal. Under the law of contract act,

an agent is not limited to work on behalf of only one principal, and therefore an agent may work

under more than one principal at the same time while a servant is usually serve only one master

at a time, who has employed him and paying him for the services that he or she provide to the

master at the specific time. Therefore a servant cannot serve two masters at the same time, since

he cannot provide services to two different masters at the same time, for instance a domestic

servant cannot work into two houses at same time but a director who is considered as the agent

of the company can be appointed as a director into more than one company.

Authority to create contractual relationship. An agent has authority to create the contractual

relationship between a principal and the third party as provided under section 134 of the law of

contract, it describe that an agent represent a principle in dealing with the third person while a

servant has no such legal authority, he or she can only do on task given to him by the master but

he cannot bid the master with third party. For instance an agent can enter into contract of sale to

sell goods on behalf of the principle while a servant as an employee example secretary only do

the task related to field of his/her professional. Case study of. James Moore Vs. Solomon Teekle,

Volume 144 Ohio Reports, Page 421. Explain e ability of agent to enter into contract as follow.

The plaintiff was the owner of a stallion which he hired out for breeding purposes. The price of

services was advertised as $5 for the season. The stallion was put with the mare for that period.

The defendant contended that he should only pay $3.50 since the groom, who the stallion in

charge had made a special agreement to that effect. If the groom was an agent with power to
negotiate with third persons, there might have been such liability; but the plaintiff contended that

the groom was a mere servant who could exercise no such discretionary authority.

Justice Moore gave the decision of the Court. The Court held that the groom was a mere servant,

whose only power was the charge and care of the horse; and as such servant he had no power to

bind his principal to a contract. Therefore judgment was given for the plaintiff.

Direct control and supervision of employer. An agent is not subject to direct control and

supervision of the principal, he or she is only required by the law exercise the same amount of

discretion as a man of ordinary prudence would exercise in his own case, the principle will say

what to do and he is not bound to express how to do certain act. It is on agent authority of how

to do certain act. Under section 140 of the law of contract provided that, an agent having on

authority to do an act has authority to do every lawful thing which is necessary in order to do

such act, while a servant act under direct control and supervision of his master and he is bound to

carry all reasonable orders given to him in the course of his work, therefore a master has a right

to say what and how the task to be done and the servant is accustomed to act in accordance with

master’s instruction and directions

They differ in mode of payment. Agent and servant do differ in the way they are paid by their

employer. The agent is to be paid his remuneration as commission which is percentage of the

amount earned from the agent dealing while in the other hand the servant is given a remuneration

known as salary or wages which a fixed amount is paid within a specified period of time

according to their agreement. For instance a week or a month and is to be paid irrespective of

work done by him

3. CONCLUSSION

The term servant and agent are in small extent synonymous in their meaning in the sense that

both are employed to work on behalf of another person but in their legal nature agent and servant

differ since agent posses the better title in his authority than servant in dealing with the third

party, he has authority to create contractual relationship between his principle and third party.
4.REFERENCE;

 Kapoor, N.D. (2008). Elements of Mercantile Law. 28th ed. New Delh: Sultan Chand and

Sons.

 United Republic of Tanzania. (2002). The law of contract Act. Dar es salaam:

Government Printers

 Kixmiller, W. and Spencer, H. W (1915) Business Law Case Method, 7th ed, Commerce
clearing house,