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Unit 9: Law of Agency
9.11 Self Assessment Notes
State whether the following statements are true or false:
1. A substituted agent is as good agent of the agent as a sub-agent.
2. An ostensible agency is as effective as an express agency.
3. Ratification tantamount to prior authority
4. Agent being merely a connecting link is never personally liable.
5. An agency coupled with interest is irrevocable.
Fill in the blanks:
6. The principal is not liable for ……………… acts done by the agent at the instance of the
principal.
7. The liability of an undisclosed principal is similar to that of a disclosed principal unless
there is a ……………… making the agent liable.
8. A ………………… is a mercantile agent engaged to buy and/or sell property.
9. The person executing the deed is known as the ……………….
10. The power of attorney is required to be engrossed on ……………….
9.12 Review Questions
1. How is agency created?
2. What is ‘agency by estoppel’? In what way does it differ from agency by holding out?
3. Explain clearly the meaning of ‘agency by ratifi cation’. What conditions must be fulfi lled
for a valid ratification? Explain the effects of a valid ratifi cation.
4. Discuss the extent to which agent can delegate his authority. State the consequences where
the agent properly employs a sale agent and when he appoints him without authority.
5. Discuss the rights of agent against his principal.
6. In what ways may a contract of agency be terminated by the act of the parties?
7. Describe the meaning of ‘agency by ratification’. What conditions must be fulfilled for a
valid ratification? Explain the effect of a valid ratifi cation.
8. “Agent having an authority to do an act has authority to do every lawful thing which is
necessary in order to do such act.” Comment.
9. What do you mean by del credere agent?
Answers: Self Assessment
1. False 2. True
3. True 4. False
5. True 6. criminal
7. trade custom 8. broker
9. Principal or donor 10. Non-judicial stamp paper
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