EXTENT OF AGENT’S

AUTHORITY.

NAME: RAKESH PRAKSH TORE

ROLL.NO: 27
 Extent Of Angen’s Authority sec (188)

An angent , having an authority to do an act, has authority to do every lawful thing which
is necessary in order to do act.
An agent having an authority to carry on-a business, has authority to do every lawful
thing necessary for the purpose, or usually done in the course, of conducting such business.

 Illustrations.
(a) A constitutes B, his agent to carry on his business of a shipbuilder.
B may purchase timber and other materials, and hire workmen, for the purpose of carrying
on the business.
Agent‘s Authority in an emergency sec (189)

An agent has authority in an emergency to do all such acts for the purpose of protecting
his principale form loss as would be done by a person of ordinary presence,
In his own case under similar circumstances.

 Illustrations.
(a) A consigns provisions to B at Calcutta, with directions to send them
immediately to C, at Cuttack. B may sell the provisions at Calcutta. If they will not bear the
journey to cuttack without spoiling .
 Case law –
sim and co V mildland Rail co.
Where butter was in danger of becoming useless owing to delay in transit and it was
impossible to Obatin instructions of the principal, The railway company sold the butter
for the best Available price. It was held that the principal was bound by this sale.
 Personal liability of Agent

1. Where the Agent Acts for a Foreign Principal: When an agent contracts for the sale or
purchase of goods for the principal residing abroad, the agent is personally liable for such
contracts.However, the agent can exclude his personal liability by expressly providing in the
contract not to incur personal liability.
2. Where the Agent Acts for an incompetent Principal:
When the agent contracts for a principal who is not competent to cotract such as minors, person
of unsond mind etc. The agent is personally liable on the contracts.
3. Where the Agent Acts for a Non- existing Principal:
Where the agent acts for a principal who is non-existent, the agent is personally liable on the
contracts. For instance, the promoter, contracting on behalf of the company, which is yet to be
incorporate, are personally liable
4. Where the agent Acts for an Undisclosed Principal:
Where the agent acts for an undisclosed principal, he is personally liable on the contract.
But where the agent discloses that he is only an agent or the third party knows that he is acting as an agent of another, then
the agent is not personally liable.
5. Where the Contract Expressly Providing:
If at the time of entering into a contract with a third party, it is expressly agreed that the agent shall be
personally liable for the contract, the agent incurs personally liability.

6. Where the Agent Contracts in Excess of his Authority:

Where the agent contracts exceeding his authority, he is liable to third party for any loss caused to him .
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