CASE LAW ANALYSIS ON THE TOPIC PRIVITY OF CONTRACT UNDER INDIAN
LAW
105 LAW OF CONTRACT
Submitted by
Shahil bhattarai
SM0123046
1st year & 1st Semester
Submitted to
Ms. Monmi Gohain
Assistant Professor of Law of Contract
National Law University and Judicial Academy, Assam
TABLE OF CONTENT
1. INTRODUCTION…………………………………………………………………..1
2. CASE ANALYSIS:…………………………………………………………………2-7
i) Introduction to the case………………………………………………..2
ii) Facts……………………………………………………………………3
iii) Issues…………………………………………………………………..4
iv) Judgement Held………………………………………………………..5
v) Court Observations…………………………………………………….5
vi) Analysis………………………………………………………………..6
vii) Conclusion……………………………………………………………..7
3. REFERECE…………………………………………………………………………8
CHAPTER 1
INTRODUCTION
Delegating all or some of one's authority to another individual or appointing another
individual to act as one's representative is a practise that is quite frequent in today's society.
The term "agency" refers to the act of entrusting a portion of one's authority or power to
another individual and placing that other in the role of our representative.
The Indian Contract Act includes the topic agency as a component that is both essential and
fundamental. At this point in time, it is extremely normal to delegate all or some of one's
authority to another individual. Any kind of transaction, whether it be a large or small
business agreement, a trade, a routine agreement, or any other kind of transaction, the
position of agent or agency has a significant amount of weight. The terms "agent" and
"principal" are defined under Section 182 of the Indian Contract Act. According to this
section, an agent is a person who has been designated by another individual to represent them
in any form of professional job or interactions with a third party. Whoever is responsible for
appointing the agent to act on his behalf is known as the principal. Therefore, the meaning of
the phrases "agent" and "principal" is straightforward, but the activity itself is fraught with a
great deal of danger. In order to address the issue that develops between the Principal and the
Agent, the Indian Contract Act provided the Principal and the Agent with certain rights and
responsibilities at the same time. Because of this, the principle is now entitled to the
responsibilities of the agent.
1
CHAPTER 2
CASE ANALYSIS
1) CASE NAME: Keppel v. Wheeler
2) CITATION: 136 LT 203
INTRODUCTION TO THE CASE:
The plaintiff A commissioned the defendant B, a real estate agent, to market a group of
apartments for sale. C extended an offer for the flats subject to contract to B, who
subsequently conveyed this offer to A, who then accepted it. B was no longer required to
actively seek better offers and really believed that his responsibility towards A had been
fulfilled. Upon receiving a more lucrative offer from D, he chose not to inform A about it.
Instead, he orchestrated a transaction where C sold the flats to D. B received a
commission for this resale. Contracts were signed and exchanged between A and C, as
well as between C and D. Shortly after this, A became aware of the transaction between C
and D. It is acknowledged that B acted with sincerity and honesty.A is suing B for the
monetary discrepancy resulting from the disparity between the price A received from C
and the price A would have received from D, had A been informed of D's offer. The basis
for his legal claim is that B had a contractual obligation to inform him about D's offer. B
asserts a counterclaim in order to seek his rightful commission. The judge ruled in favour
of defendant B on both the claim and the counterclaim, determining that B stopped to act
as A's agent for finding a purchaser after A accepted C's offer. The appellant, A, lodges an
appeal. The Court of Appeal renders a verdict in favour of party A on the claim and in
favour of party B on the counterclaim.
ISSUES
1. Was the agreement between A and C a valid contact ?
2. If this agreement was not a valid contract did the acceptance by A of C’s offer
terminate B’s agency?if not did it end B’s duty of searching for higher offers , and did
it end his duty of disclosing to A nay higher offer which he got ?
2
JUDGEMENT/DECISION HELD
The defendant was an agent for the plaintiff. The agent was asked by the Plaintiff to
sell a house. One offer was made by A through the agent and it was accepted by the
Principal subject to a condition. Later, another offer was made by B, but this time the
offer is higher than the first offer made by A. The agent did not inform the Principal
about B’s offer. Principal signed the contract with A. Principal took an action against
agent. The agent was liable by the court because he must use his skill and care for the
benefit of the Principal. Since the agent did not do so, he was liable to pay the
principal the difference between the two offers.
COURT’S OBSERVATION
Due to the fact that the agent was required to apply his expertise and care for the benefit of
the Principal, he was held accountable. The fact that the agent did not comply with the
request meant that he was responsible for paying the principal the difference between the two
bids.
CONCLUSION
It is evident that if an agent, while working, is found to have violated their fiduciary duty,
they would often lose any entitlement to payment. That appears to be firmly proven in my
opinion. However, it is possible for breaches of duty to occur that do not affect the entire
contract and do not prevent the agent from receiving their payment. In this particular
situation, it is determined that the agents acted honestly, the transaction was successfully
carried out, and the appellant has benefited from it. Therefore, the appellant is obligated to
pay the commission.
3
REFERENCE
Websites
Manupatra:
https://www.manupatrafast.in/pers/Personalized.apx
SCC online:
https://www.scconline.com/Members/NoteView.aspx?
enc=QUlSIDE5NzAgU0MgNTA0JiYmJiY0MCYJiYmU2VhcNoUGFZQ==
