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Sukhpreet Kaur, Lovely Professional University Unit 12: Law of Agency

Unit 12: Law of Agency Notes

CONTENTS
Objectives
Introduction

12.1 Definition of Agent and Agency

12.2 Different Kinds of Agencies
12.3 Classification of Agents

12.4 Duties and Rights of Agent
12.5 Principal’s Duties to the Agent and his Liabilities to Third Parties

12.6 Personal Liability of Agent
12.7 Termination of Agency
12.8 Summary
12.9 Keywords

12.10 Self Assessment
12.11 Review Questions
12.12 Further Readings

Objectives

After studying this unit, you will be able to:

Define agency and agent
Discuss the different kinds of agencies
Explain the right and liability of agent and principle
Describe termination of agency and its modes

Introduction

In the previous Unit, you came to know about the Contract of pledge. In this unit you will study
about the contract of agency.
Before the Industrial revolution, business was carried on largely by individual artisans in their
homes and in small family operated shops. As population and trade expanded and division of
labour and specialisation became the order of the day, there arose the problem of distribution
of goods. To meet the rising demand, manufacturers and shopkeepers began to hire others to
work for them. These helpers or “servants” as they were called performed whatever physical
tasks were assigned to them, under the close personal supervision of the “master”. The Indian
Contract Act, 1872, makes provisions as regards agency. Secs.182 to 238 deals with the subject of
agency.

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