Agency Flashcards
The principal agent relationship
Principals employ the services of agents to act on their behalf to enter into contracts or dispose of their property. It is governed by consent of p and a, authority of a to affect p’s legal position and p’s control of a’s action.
Agency case
Gloria Wilson v Wigvon Cadogan and Selby Renetta Ross the claimant wanted to say that they took up ownership of the land through their agent but no existence of agency was present so the appeal was dismissed
Principal’s duties to the agent
P’s duties to A seem to be much less onerous than those owed by A to P. nevertheless, it is expected that P will act in good faith in his relations with A. P must accept legal commitments made by AA in accordance with the authority granted to A.
P duties to A case 1
Fazall v Annamanthadoo
Agent’s duties to the principal
Acting in good faith is the foundation of the relationship between p and a but there are also other obligations:
a) the duty not to delegate his office, b) the duty not to put himself in a situation where his duties as agent conflict with his own interests, c)the duty not to accept bribes or secret commissions from T(otherwise A will be held criminally liable to P), d) the duty not to take advantage of his position in order to gain benefits for himself, and e) the duty to hand over to P money which he holds to his use, and to account to P
These fiduciary duties require A to:
a) comply with reasonable instructions given by his principal, b) act with skill and care, c) make proper efforts to negotiate and, where appropriate, conclude the transactions he is instructed to take care of, and d) communicate to P all the necessary information available to him.
A’s duty to P case
Ann-Marie Patterson v Don Providence
Third Party
Agency is ‘the fiduciary relationship which exists
between two persons, one of whom expressly or
impliedly consents that the other should so act as
to affect his relations with third parties, and the
other of whom similarly consents so to act or so
acts on his behalf.
Express Authority
P may explicitly state to A the authority he may excercise when conducting transactions on P’s behalf.
Express Authority case
Marubeni Hong Kong and South China Limited v Ministry of Finance of Mongolia. The claimant said that the defendant undertook a primary liability to the claimant. The defendant said that it was discharged from liability under the guarantee. The MMOF letter was issued on behalf of the defendant with express actual authority. The cabinet meeting did not authorize the minister of finance to undertake a primary liability
Implied Authority
An agent has implied authority to do whatever is necessary for, or ordinarily incidental to, the effective execution of his express authority in the usual way.
Implied authority case
Crown Corke de Guatemala SA v Carlo Products Limited, Carlys Dalia Hughes.
Mr Hughes was the managing director of Carlo Products and entered a contract with the claimant for goods on behalf of Carlo Products Limited. Carlo tried to argue that he went beyond the scope of his authority in making the contracts but the court held that as the managing director that authority was implied and the contract must be fulfilled by Carlo Products
Necessity
The law imposes an agency of necessity in a limited number of situations where a party (a) confronted with an emergency which poses such an imminent threat to the property or other interests of another person that there is no opportunity to seek the latter’s prior authority or instructions, acts for that person without his authority in order to preserve or protect that property or those interests.
There are four conditions which must be met to create an agency of necessity: 1) A must be able to show that he was unable to obtain instructions from P, 2) A must satisfy the court that he acted in a bona fide manner in the interests of P, 3) A’s actions must have been reasonable and prudent in the circumstances, 4) There must have been some necessity or emergency to compel A to so act
Necessity case
Bisnath Boodram v The Bank of Nova Scotia Trinidad and Tobago and Leelawatie Boodram
The second defendant claimed she was acting as an agent of necessity. The court determined however that there was no evidence that the defendant became an agent of necessity or that her husband was unable to act for himself.
