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Unit 9: Law of Agency

(b) goods, purchased were not necessaries, Notes

(c) he had given sufficient money to his wife for purchasing necessaries, or
(d) the trader had been expressly told not to give credit to his wife.
2. Where the wife lives apart from the husband, through no fault of hers, the husband is liable
to provide for her maintenance. If he does not provide further maintenance, she has an
implied authority to bind the husband for necessaries, i.e., he would be bound to pay her

bills for necessaries. But where the wife lives apart under no justifiable circumstances, she
is not her husband’s agent and thus cannot bind him even for necessaries.

9.3.4 Sub-agent and Substituted Agent

The general rule is that agent cannot appoint agent. The governing rule is enshrined in a
maxim ‘a delegate cannot further delegate’. Agent being a delegate cannot transfer his duties
to another. The principle underlying the rule is that the principal engages agent ordinarily on
personal consideration and thus may not have the same confidence in the person appointed by

the agent. Hence, sub-agency is not generally recognised. However, deals with the circumstances
as to when and how far agent can delegate his duties. Agent may appoint agent in the following
circumstances:
1. where expressly permitted by the principal;
2. where the ordinary custom of the trade permits delegation;
3. the nature of agency is such that it cannot be accomplished without the appointment of a
sub-agent;
4. where the nature of the job assigned to the agent is purely clerical and does not involve
the exercise of discretion, e.g., if Anthony is appointed to type certain papers, because of
lack of time, he assigns the job to another equally competent typist Bharat, the delegation
is valid;

5. in an unforeseen emergency.
Under the above-mentioned circumstances stipulated by s.190, if agent appoints another person
in the matter of the agency, that other person may assume the position of either a sub-agent
or a substituted agent. Section 191 states that a sub-agent is a person employed by and acting
under the control of the original agent in the business of agency. Since the sub-agent is appointed
by the act and under the control of the agent, there is no privity of contract between the sub-
agent and the principal. The sub-agent, therefore, cannot sue the principal for remuneration
and, similarly the principal cannot sue the sub-agent for any moneys due from him. Each of
them can proceed against his immediate contracting party, viz, the agent except where the
sub-agent is guilty of fraud. In that case, the principal has a concurrent right to proceed against
the agent and the sub-agent. A sub-agent properly appointed, however, can represent the
principal and bind him for his acts as if he were agent originally appointed by the principal. But
where agent, without having the authority to do so, has appointed a sub-agent, the principal is
not represented by or responsible for the acts of such a sub-agent. The sub-agent can only bind
the agent by contracts entered into with third parties.
Where agent appoints or names another person for being appointed as agent in his place, such
person is called a substituted agent (s.194).

Examples:
1. Amar directs Bharat, his solicitor, to sell his estate by auction and to employ an auctioneer
for the purpose. Bharat names Cooper, an auctioneer, to conduct the sale. Cooper is not a
sub-agent, but is Amar’s agent for the conduct of the sale.

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