Duties of an agent towards the principal Theories of agency are quite old in nature. Most of its applications have been observed from long ago. It is a fact that whole agency system has based on the principles of contract. So, it is true that there are contractual obligations between principal and its agent. The English law of agency specifically highlights rights and duties of agent and principal, both. According to the general principles of legal jurisprudence, rights and duties are correlated. If laws provide some rights to a person for some specific purpose, that person will possess some duties along with it. But in this task, the principal job is to identify the duties of an agent towards the principal. So, here only a part of the agency system is to be described.
In this regard, a quick glance about the history of English agency system is noteworthy. It is observed that there was a link between English theories of agencies and Anglo-American laws of agency. In earlier times, intercontinental trade was a common phenomenon. The law of contract and principles of agencies had been the mostly used commandment of that time. So, interlink between the laws of different countries were very common. If we minutely observe the English law of agency, it would be visible that most of the provisions are dealt with extent of liabilities between principal and agent.
As, highlighted by the “Statute of the Staple”, a master has limited liability for any tortuous acts of his servant. But this statue was mainly focusing on commercial dealings. Plus, it was identified that such limited provisions were became ineffective in vast ranges of business dealings. Due to enormous industrial growth, there were modifications and amendments of the provisions had become prime concern. It is true that there were existence of both commercial and non-commercial agency systems. Add tot this, trades were emerging as global occurrence. The proprietors had to depend more on the agencies. There were essential requirements for making some effective provisions of laws that could regulate agency systems precisely. English contract law and subsequent development of law of agencies have helped to overcome this situation. According to law of agency, an agent has limited liability, and principal can be blamed for its acts. There is nothing astonishing in this provision; according to reports, in medieval times it had been observed that a person could be held liable for the acts of another person. It is fact that agents have fair limits in his/ her acts. It has been in practise for long times and more importantly have been recognized by numerous statutes.
It is not contentious to state that a principal is accountable for the predictable outcomes of his/her acts. The further tricky matter is the classification of the predictable outcomes when the principal’s employ of an agent in his/her dealings. It will be supportive, in responding that query, to explain first what is intended by ‘employing of an agent in his/her work.’ An agent is an individual who has contracted to perform specific acts on behalf of the principal. But the whole task is subject to under direct control of the principal.
The agent must possess some authorities to act accordingly, but it is not reasonable to think that he/she can enter into a contract without prior consent of the principal. The principal may not provide such power to the agent. The fundamental job of an agent is to deal with third parties on behalf of the principal. In this regard, he/she may need to perform some negotiations with third parties, but certainly he/she should not enter into a contract without the permission of his/her principal. It is fact that he/she works as a mere informer of the principal, and the ultimate decisions must be taken by the principal only. For establishing an agency, there must be an agency relationship. Contract is not always necessary to form an agency, but building of an agency relationship between principal and agent is essential.
As, highlighted earlier, details of the work, schedule and place of the work can be easily identified in the contract of agency, but the difficulty arises in the times of accountability of such work. According to the law of contract, agent can not be held liable for his/her acts when outcomes of the acts can easily be predicted. But the question is that how it will be decided and on which grounds is has to be fixed that such outcomes are predictable. Here comes the question of reasonableness, and each situation has to be decided on its merits.
Convey the directions are vital and any agent violating these will be involuntarily accountable for any failure which is done to the principal. This obligation is the most important one, and the duty to perform task with sensible care and skill is considered as the second most important.
Two significant questions halt from this overview. Firstly, all the orders and instructions must be accepted in written format. Any oral orders shall not acceptable. It has been seen that verbal orders creates problems in understanding and for future references. That’s why it is always better to have instruction in written forms. Secondly, contract of agency must specifically mention what the business is all about and exactly what tasks the agent has to perform on behalf of the firm. There should not be any ambiguity in contract of agency, and both principal and agent must be clear on their respective functions.
The single applicable justification to go against such orders is that such articulate orders are apparently against the law, for instance if the principal ordered the agent to supply equipments to some terrorist organizations, etc.
An agent has to work with due concern and proficiency towards his job. But it should be evaluated on the basis of work environment and other associated factors.
From the business point of view, this duty is considered as the most significant
Professional ethics and efficiency of the agent has to be judged on this ground. Performance appraisal and promotion all depend upon this
It is expected that an agent who is the job to look after some property of the principal, has the duties to measure all the perils associate with the property and informs them to the principal accordingly.
It is expected that the agent should apply his/her skills and experiences to tackle any work relates with the agency.
If, an agent is consigned to maintain a property of the principal, ten it is expected that he/she will take proper care to repair and develop the property with accuracy.
In this context, the Brutton v Alfred Savill, Curtis & Henson (1971), case is a good example, which helps to understand what exactly concern and proficiency exactly means.
It was held that, as the usual experienced estate agent would not have been engaged in by this plain poise hoax, the immature employee's unwariness amounted to carelessness, and the defendants were thus responsible for the damage of the clients.
If an agent is engaged to administer the assets, the agent will usually be accountable for inculcating workers to perform essential maintenance. Even though, the agent is not usually accountable for inadequate works of the contractors, he/she could be responsible only, if the workers were in employment directly by the agent.
Similarly, there is impending accountability to a property-owner for poor condition of the assets such as houses or land, etc. and a truant property-owner depends completely on his agent for their maintenance. If a leaseholder takes legal actions against a property-owner in this frame, the property-owner may well take legal action against the agent for his/her carelessness.
In this regard, McCauley v Bristol City Council (1991) case, and its judgement is noteworthy.
And the court held that Tenants provided a faulty land pace. The landowner was unsuccessful to perform maintenance. The tenant got injured. The council were held responsible for that. He found guilty for not maintaining the property properly, as an agent. The tenant was compensated with £4,500.
This occurs involuntarily out of the fiduciary character of the association between agent and principal. The fundamental belief is that the agent must not agree to some own concern or the concern of a third party to acquire inconsistency with the concerns of the principal
But if, the principal is aware of that fact and given his/her consent, then there is no problem.
For instance, where an agent was leasing a land to a companion or family member. The agent has an inconsistency of concern and it is wise for the agent to inform his/her principal of the situation and get consent to proceed.
Where an agent has unsuccessful to reveal his private concentration, the principal may prefer to reserve the operation or to avow it and aver the yield made by the agent.
In addition, the agent should not receive furtive yields which are amounts to corruptions
An agent should work according to the terms and conditions of the contract of agency. It is reasonable to be believed that an agent shall take prior permission before doing an act which is not mentioned in the contract.
According to the law of contract, there should be an offer and an acceptance subsequent to that offer, to initiate formation of a contract between two parties. If, the offer is accepted, then it will have binding effects on both the parties. It is a continuous process of negotiation, where both the parties discuss and decide upon different associated matters and their consequences, only then both reaches at a promise. Consideration is another important ingredient of agreement. After all this, if the agreement is legally viable, it shall be considered as a contract. Terms and considerations of contract have to be crystal clear for both the parties. If, it is so, they can put their respective consent on it. After, offer and acceptance, there are normally no way-back to avoid the contract. But it a question of fact- how long the offer remain active for its acceptance. It is true that time is the essence of every contract. In English contract law, there are certain rules concerning the duration of offer.
In this context, some of the terms have to be cleared before going into any further, such as ‘offeror’- the individual who is making an offer; ‘offeree’- the individual to whom it is made. It is a fact that, both offer and acceptance are completely based on accurate communications. Now, the question which arrives, is that- how long an offer may remain active for its acceptance? There are many case laws, which might help to analyse this issue and get some reasonable answers. According to the common law, there are different circumstances when an offer shall be considered as ineffective. Some of such circumstances are given below:
If, an offeror is conditioned that an offer will stay active for a specific period of time, it shall be considered as end when that time is up
Despite this fact, it can be withdrawn before that
If, it is not mentioned, how long the offer will stay unwrap, it will end subsequent to a sensible span of occasion, precisely how lengthy this is will relies upon factors such as mode of communication in course of offer, the content of the offer, etc.
For instance, offers to purchase consumable commodities, or a product whose price vary every day, will end rather hastily. Bid to obtain shares on the stock market might end quickly.
In regard, Ramsgate Victoria Hotel v Montefiore (1866) is noteworthy.
In this case it was held that those five months was not a sensible span of occasion for acceptance of an offer for purchasing the shares, because to buy shares are kind of commodity whose price changes very quickly. For that reason it would be considered that the offer had terminated ahead of company’s procedures to acceptance, and no contract was formed between the parties.
A number of offers are made subject to definite circumstances, and if such circumstances are not in consign, the offer possibly will end
In this regard, there are different rulings which noteworthy. In many cases it has been observed that court has given much importance to the implicit circumstance such as whether the carriage remained in the identical condition as it was in when the offer was made, and pending the acceptance.
If any of such implicit pre-conditions had been ruined by any of the parties, the offer would be considered as inactive and there shall be no question of further proceedings.
Another usual for of ending an offer is the refusal. An offer terminates when the offeree discards it. If ‘A’ offers to rent ‘B’ his room on Sunday, and in reply ‘B’ says no, then ‘B’ cannot come back on Friday and clamour for accepting the offer.
According to the English contract law, counter-offer ends the original offer.
An application or demand for mere further information about an offer like whether price of the goods could be lessen or time of delivery could be curtailed does not consider as a counter-offer, and the original offer remains active.
In this regard, Stevenson Jaques & Co v McLean (1880) and Hyde v Wrench (1840) are noteworthy cases.
In Hyde v Wrench (1840) it was held that this offer is no longer valid, if there was a counter offer in this milieu.
But it is fact that offeror is free to provide another offer on the same context. Add to this, he can not be compelled to make such offer; it completely depends upon his own free will.
It has to be determined precisely what is mere inquiry about facts and what is not so, on each case basis.
There very few cases in this concern. The provision for this is ambiguous.
But it appears feasible that if the offeree knows that the offeror has passed away, the offer may end; if the offeree is uninformed about the offeror’s demise, it perhaps not end.
In this regard, Bradbury v Morgan (1862) is quite important.
So if, for instance, ‘A’ promises to sell his watch to ‘B’, then passes away soon after, and ‘B’ send a letter of acceptance for the offer not knowing that ‘A’ has already passed away, it appears that the A’s legal heirs or managers could be bounded to sell the watch to ‘B’ and consequently ‘B’ has to pay the prices in the form of consideration to them.
Nevertheless, if an offer needs some specific personal actions by the offeror, it shall generally be ended on the demise of the offeror.
There are no English cases on this concern.
But it appears plausible that the offer may end and cannot be accepted after the Demise or death of the offeree.
In such cases it is not feasible that an offer is being accepted by some legal heirs of the deceased person.
The extraction of an offer is occasionally illustrated as the revocation of an offer.
According to the rules established in Payne v Cave, an offer perhaps pull off at any time up until it is accepted.
In this regard contributions of Routledge v Grant (1828) was significant one.
It was held that the defendant at a halt had the right to pull out the offer at every instant prior to its acceptance, although the period boundary had not terminated.
Other rules may also be relevant in association with the extraction of offers.
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