Difference btw Agent, Servant, and employee

An agent is employed to bring the principle into the legal relationship with a third person or to
represent him in the dealings with a third person. A servant does not automatically or ordinarily
create a legal relationship between his employer and the third person. An agent represents the
principle while servants and employees work for the principle.

An agent is bound to follow all the lawful instructions of the principle but he is not subject to the
direct control or supervision of the principle. A servant and employee act under the direct control
or supervision of his employer and is bound to follow all reasonable orders given to him in the
course of his employment.

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An agent may work for several principles at the same time but a servant or employee usually
serve one master.

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A principle is liable for all the wrongs of the agent within the scope of his authority a master or
employer is liable for all the wrongs of the servant or employee with in the course of his
employment.

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In agency consideration is not mandatory but in employment consideration is important.

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Del credere agent – These are the kind of agent who ensure that the contract is performed in its
entirety and they also receive a commission for doing so.

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Agency

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On the basis of appointment agency is of three kinds:

1. Agent – “Qui facit per alium facit per se” that

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is consider that it is done by the appointing person himself. The person who appoints
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such other is called principal and the person appointed is called the agent. For the acts of
the agents the principal is primarily responsible.
2. Sub Agent - A sub agent appointed with the authority of the principal is responsible for
his actions to his agent while the agent is responsible for his and sub agents’ action to the
principal. The sub-agents contract with a third person is binding upon the principal as it
was entered by the principal himself. The principal and the sub agent are not directly
related expect in the cases of fraud and wilful wrong. The subagent appointed improperly
will serve as the original agent for the agent. In such contract the principal will not be
liable in any circumstance.
3. Substituted agent – Substituted agent is an agent who is named by the agent for some
specific purpose and is appointed by and is responsible to the principal himself.
Ratification

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 Sometimes a person acts on behalf of another without his consent or approval or knowledge if
later the act is accepted it is said to be ratified and agency in that regard would be created.

Essential of ratification –

1. It is necessary that the act should be done on behalf of the principal.

2. The principal should be competent to enter into a contract.
3. Ratification may be expressed or implied.
4. The principal must have complete knowledge of the transaction.
5. Ratification can be done of the entire transaction and not for a part there of.
6. Ratification shall not be injurious to third person and it should be within a reasonable

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time.

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7. Ratification back to the day on which the agent first contracted. There is a contract

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between the principal and the third party not from the date of ratification but from the
date of first contract by the agent.

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8. Ratification establishes the relation of contract between agent and the third party.

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