Duties and Rights of Agent's and Principals Summary

Question 1

Gilmour v. Clark 1853

Answer 1

Obey the instructions of the principal - The principal instructed the agent to put the goods on one ship; then the agent’s servant put them on another, which sank. The agent was liable for these actions.

Question 2

Lord Fullerton on the skill and care of a professional.

Answer 2

‘Where the agent is a professional person, his duty is that of a reasonable, competent and careful member of that profession’. Cooke v. Falconers Representatives 1850

Question 3

Bell on the standards of an agent

Answer 3

‘The skill of a prudent man in managing his own affairs’.

Question 4

Robertson v. Drummond and Reid 1881

Answer 4

Use their position for their own benefit - When a solicitor employs an auctioneer for a client, they must benefit that client with any discount that they receive.

Question 5

McPherson Trustee v. Watt 1877

Answer 5

Let personal interest conflict with the business - Watt sold 4 properties on behalf of the trustees. Selling to his brother for a discounted price. This case highlights you must be honest in your transactions.

Question 6

Liverpool Victoria Friendly Society v. Houston 1900

Answer 6

Information remains confidential - 4 years after Houston worked for LV he disclosed their customer list. Tried to argue he was no longer an agent but this was not allowed.

Question 7

De Bussche v. Alt 1878

Answer 7

Act in Person - The court held there was no breach of duty by the agent in appointing a sub-agent as delegation was expressly agreed. Where the sub-agent fails in their duties the agent can be liable.

Question 8

MacKersy’s Executors v. St Giles Cathedral Managing Board 1904

Answer 8

Right to Remuneration - Rebuttable presumption that the agent is entitled to payment for work if the work is part of the agent’s livelihood.

Question 9

Lord Kinnear on the right to relief against the principal

Answer 9

‘In the first place to be indemnified for the monies he has expended, or the loss he has incurred’. Glendinning v. Hope 1911

Question 10

Drummond v. Muirhead & Smith 1900

Answer 10

Right of Lien - Looked after an estate where the party was bankrupt. The drafted deeds were retained until payment was made. The court held this was allowed.

Question 11

‘Where the agent is a professional person, his duty is that of a reasonable, competent and careful member of that profession’. Cooke v. Falconers Representatives 1850

Answer 11

Lord Fullerton on the skill and care of a professional.

Question 12

Obey the instructions of the principal - The principal instructed the agent to put the goods on one ship; then the agent’s servant put them on another, which sank. The agent was liable for these actions.

Answer 12

Gilmour v. Clark 1853

Question 13

Use their position for their own benefit - When a solicitor employs an auctioneer for a client, they must benefit that client with any discount that they receive.

Answer 13

Robertson v. Drummond and Reid 1881

Question 14

‘The skill of a prudent man in managing his own affairs’.

Answer 14

Bell on the standards of an agent

Question 15

Information remains confidential - 4 years after Houston worked for LV he disclosed their customer list. Tried to argue he was no longer an agent but this was not allowed.

Answer 15

Liverpool Victoria Friendly Society v. Houston 1900

Question 16

Let personal interest conflict with the business - Watt sold 4 properties on behalf of the trustees. Selling to his brother for a discounted price. This case highlights you must be honest in your transactions.

Answer 16

McPherson Trustee v. Watt 1877

Question 17

Right to Remuneration - Rebuttable presumption that the agent is entitled to payment for work if the work is part of the agent’s livelihood.

Answer 17

MacKersy’s Executors v. St Giles Cathedral Managing Board 1904

Question 18

Act in Person - The court held there was no breach of duty by the agent in appointing a sub-agent as delegation was expressly agreed. Where the sub-agent fails in their duties the agent can be liable.

Answer 18

De Bussche v. Alt 1878

Question 19

Right of Lien - Looked after an estate where the party was bankrupt. The drafted deeds were retained until payment was made. The court held this was allowed.

Answer 19

Drummond v. Muirhead & Smith 1900

Question 20

‘In the first place to be indemnified for the monies he has expended, or the loss he has incurred’. Glendinning v. Hope 1911

Answer 20

Lord Kinnear on the right to relief against the principal

Question 21

List the duties an agent owes to the principal -

Answer 21

i) To obey the instructions of the principal.
ii) To exercise due care and diligence.
iii) To account to the principal.
iv) To act in good faith in the principals interest.
v) To act in person.

Question 22

List of an agent rights against the principal -

Answer 22

i) Right to remuneration.
ii) Right of relief against the principal.
iii) Right of lien.

Question 23

List the concepts of good faith that an agent owes to the principal -

Answer 23

i) Use their position for their own benefit.
ii) Let personal interest conflict with business.
iii) Disclose confidential information.