Premium Essay

Business Law Agent

In: Business and Management

Submitted By any1555
Words 442
Pages 2
Duty to avoid conflicts of interest

When acting for the principal, an agent must not allow his own personal interests to come into conflict with the interests of his principal.

If the agent has any personal interest that might conflict with his principal's interest, he must disclose it and the principal must consent to the agent continuing to act for him. If the agent breaks this duty, his principal may set aside any transaction effected by the agent and claim any profit made by the agent.

* Practical situations include while acting as agent for the buying or selling of property, he sell property to or buy property from his principal without full disclosure of the relationship.

McPherson v Watt (1877) 3
- a solicitor acted as the agent for two ladies who wished to sell certain houses
- the solicitor himself purchased the property though nominally the property was bought in the name of his brother
- the House of Lords refused to grant the solicitor specific performance of the contract of sale
- such a breach of duty would, however, be waived if the agent makes a full disclosure of his interest to the principal and the latter is still willing to proceed with the transaction

* If an agent is employed to buy property for his principal, he must not sell his own property to his principal unless he discloses his fact

Implied or usual authority

This permits the agent to perform all reasonable incidental or subordinate acts necessary in exercise of his given express authority.

It may sometimes relates to agent of a certain type acting in the usual ways of such agent as his trade or profession usually does have authority to do or make.

This may be so even if the principal has expressly informed the agent that he has no such authority unless the third party knew of that exclusion

Watteau v Fenwick [1893]
- The defendant had employed H as manager of an hotel
-…...

Similar Documents

Free Essay

Business Law

...Law of agency From Wikipedia, the free encyclopedia Jump to: navigation, search The law of agency is an area of commercial law dealing with a contractual or quasi-contractual, or non-contractual set of relationships when a person, called the agent, is authorized to act on behalf of another (called the principal) to create a legal relationship with a third party.[1] Succinctly, it may be referred to as the relationship between a principal and an agent whereby the principal, expressly or impliedly, authorizes the agent to work under his control and on his behalf. The agent is, thus, required to negotiate on behalf of the principal or bring him and third parties into contractual relationship. This branch of law separates and regulates the relationships between: • Agents and principals; • Agents and the third parties with whom they deal on their principals' behalf; and • Principals and the third parties when the agents purport to deal on their behalf. The common law principle in operation is usually represented in the Latin phrase, qui facit per alium, facit per se, i.e. the one who acts through another, acts in his or her own interests and it is a parallel concept to vicarious liability and strict liability in which one person is held liable in criminal law or tort for the acts or omissions of another. In India, section 182 of the Contract Act 1872 defines Agent as “a person employed to do any act for another or to represent another in dealings with third......

Words: 4577 - Pages: 19

Free Essay

Business Law

...Case 1 1. An agent is a person (which can include an entity, like a corporation, partnership, or LLC) who acts on behalf of and subject to the control of another by authority from him. The category of agent can affect their liability to any claims and the two main categories of agent: General agent: a general agent is an agent authorized by the principal to conduct a series of transactions involving continuity of service, like a manager of a business. A general agent does not require fresh authorization for each transaction. Special agent: a special agent is an agent who is authorized to conduct a single transaction or a series of transactions not involving continuity of service. In other words, an agent who is given specific authority and specific instructions for a specific purpose is called special agent. Jane’s contract, which gives her authority to act on their behalf for the purchase of all ladies fashion ranges fulfills three elements-consent, control and on behalf of-of an agency relationship indicating that the case satisfies the definition of agency relationship between the Jane and her employer. Jane is supposed to be regarded as a special agent since the contract specifically mentions the range of her authority which is all ladies fashion ranges. We should pay attention that, as generally, the principal will not be liable for third parties who deal with special agents in areas outwith their specific instructions. 2. Before an agency can be......

Words: 1553 - Pages: 7

Premium Essay

Business Law

...Lease Contracts - When we turn to contracts for the sale and lease of goods we move away from common law and into the area of statutory law. - UCC article 2: on sales, 2A: on leases - The goal of the UCC is to simplify and streamline commercial transactions, allowing parties to form contracts without observing the same degree of formality used in other types of contracts by making laws governing sales and lease contracts clearer, simpler and more readily applicable to the difficulties that can arise during such transactions. The Uniform Commercial Code (1949) Comprehensive Coverage of the UCC UCC: single most comprehensive codification of laws involved in total commercial transaction Views commercial transaction for sale and payment of goods as a whole Article 1: General Provisions Definitions and general principles applicable to commercial transactions, including an obligation to perform in “good faith” all contracts un the UCC Provides basic groundwork for the remaining articles A Single, Integrated Framework for Commercial Transactions UCC attempts to provide a consistent and integrated framework of rules to deal with all phases ordinarily arising in a commercial transaction Many sections from the different articles can apply to a single transaction Periodic Revisions of the UCC To clarify certain rules or establish new rules when changes in business customs have rendered existing UCC provisions inapplicable * Articles 3 4 5 8 & 9: revised......

Words: 9821 - Pages: 40

Premium Essay

Agent and Principal Business Law

...didn’t like his customers to see him “doing business.” Coleman was talking with Jimmy about business when he spilled his drink all over the bar. That made him think about this cool trick where you put pure grain alcohol in your mouth, blow it out and light it. Coleman took a big drink, took out his lighter, and said, “What this!” He lit his lighter, blew the liquid and a fireball went through the room. The fireball hit Jimmy and killed him instantly. The bar also sustained a lot of damage. Software Inc. fired Coleman without even interviewing him to get his version of the events. Software Inc.’s handbook required all employees to be interviewed before termination. A week later, Coleman called John to make amends. When they met, Coleman said, "The company and I are so sorry about what happened. Let me take you out to dinner – Software Inc. will pay the bill." They went to a restaurant, and instantly got into an argument because John told Coleman he was fat. Coleman punched John in the eye, causing severe eye damage. Jimmy’s mother (his only heir), John, and Jimmy’s Poor-Man’s Bar (which was owned by five men, including Jimmy), sued Software Inc. for the damage caused by Coleman. Coleman sues Software Inc. for wrongful termination. Lastly, the jewelry store sued Software Inc. for the value of the ring. You are the judge in these cases! In your answer, discuss the relevant law and apply the facts given to that law. If you need more facts to come to a......

Words: 681 - Pages: 3

Premium Essay

Business Law

...(Derry v Peek 1889). Mistake: Common: Both parties make the same mistake (Leaf v International Galleries). Mutual : Both parties make different mistakes (cross-purposes)(Raffles v Wichelhaus 1864).Unilateral: Only one party is mistaken and the other party knows or should know of the mistake.Petelin v Cullen (1975); and Foster v MacKinnon (1869).Under Common Law, a mistaken K is void. There was never a contract, and any property transferred will have be returned to the true owner.Unconscionable Conduct: Plaintiff is under a ‘Special Disadvantage’ “poverty or need of any kind, sickness, age, infirmity of body or mind, drunkenness, illiteracy or lack of education, lack of assistance where assistance or explanation is necessary.” Blomley v Ryan (1956). ‘Unconscientious Advantage’ of that. Involves the stronger party taking unfair advantage of the weaker party’s disadvantage. Hence, it would seem that knowledge of the other’s disadvantage is needed. A’s guaranteed their son’s debt to the Commercial Bank. A’s signed certain documents which provided the bank with a mortgage over a building which they owned. When the son’s business failed, the bank sought to enforce the guarantee and sell off the building. In their defence, the A’s asserted that the guarantee was unenforceable because it was unconscionable.The evidence showed that:The parents had little literacy in written English.They had not received independent legal advice nor did the bank suggest that they obtain independent......

Words: 4854 - Pages: 20

Free Essay

Business Law

...Nature of Law | Definition of Law “a rule of civil conduct prescribed by the supreme power in a state, commanding what is right, and prohibiting what is wrong’ (Blackstone)Functions of Law to maintain stability in the social, political, and economic system through dispute resolution, protection of property, and the preservation of the state, while simultaneously permitting ordered change. Legal Sanctions are means by which the law enforces the decisions of the courts.Law and Morals are different but overlapping; law provides sanctions, while morals do not.Law and Justice are separate and distinct concepts; justice is the fair, equitable, and impartial treatment of competing interests with due regard for the common good. | Classification of Law | Substantive and Procedural Law * Substantive Law: Law creating rights and duties. * Procedural Law: Rules for enforcing substantive law.Public and Private Law * Public Law dealing with the relationship between government and individuals. * Private Law governing the relationships among individuals and legal entities.Civil and Criminal Law * Civil Law dealing with rights and duties the violation of which constitutes a wrong against an individual or other legal entity. * Criminal Law establishing duties, which, if violated, constitute a wrong against the entire community. | Source of Law | Constitutional Law fundamental law of a government establishing its powers and limitations.Judical Law * Common Law body of law......

Words: 833 - Pages: 4

Premium Essay

Business Law

...Topic Two Contract Law: Formation of Contracts [A] Introduction Contract law concerns with regulation of the legal relationship of the parties to contracts. A contract is an agreement having legally binding effects on its parties. In other words, generally speaking, the party who broke the contract has to compensate the innocent party for his loss. How to form a contract? All the 4 following elements are needed for forming contracts: - a. Offer b. Acceptance c. Intention d. Consideration [B] Offer What is an offer? • The expression of a person’s intention to others to have a legally binding agreement. • The maker of the offer is called the offeror. The recipient is called the offeree. Important rules about offers: - (a) Certainty of the offer A contract must contain the basic terms of the relevant transaction. Normally, the following 2 items are needed to form an agreement: - i. Price (e.g. how much is the house that I am going to sell to you?) ii. Property (the seller has to show the buyer the goods or to describe them briefly: Hillas & Co Ltd v Arcos Ltd [1932] All ER Rep 494). * Under the Sale of Goods Ordinance (cap.26 of the Laws of Hong Kong), the buyer is required to pay a reasonable price for his purchased goods if there has not been a specified price in the agreement. Under the Supply of Services Ordinance (cap.457 of the Laws of Hong Kong, the party contracting with the supplier has to pay a......

Words: 6034 - Pages: 25

Free Essay

Business Law

...Robert W. MOSER, Plaintiff-Appellant, v. Mary BERTRAM, Defendant-Appellee SUPREME COURT OF NEW MEXICO 115 N.M. 766; 858 P.2d 854; 1993 N.M. LEXIS 221; 32 N.M. St. B. Bull. 693 August 10, 1993, Decided OPINION BY: FROST This appeal from a summary judgment requires us to determine whether a real estate seller's agent owes a fiduciary duty to a prospective purchaser when the seller's agent and the purchaser's real estate agent work for the same real estate broker. The district court held that there is no such fiduciary duty, and we agree.The material facts are undisputed. Plaintiff-appellant Robert Moser, an individual from California interested in purchasing investment realty in New Mexico, sued defendant-appellee Mary Bertram, a real estate sales agent employed by the Santa Fe brokerage firm of Vidal Garcia doing business as Century 21 Blue Chip Realty ("Blue Chip"), for breach of fiduciary duty. Bertram was listing agent for property that Moser wanted to purchase, a residence located in Santa Fe, New Mexico. Moser hired Dolores Lee as his buyer's agent to secure his acquisition of the property. Lee, like Bertram, was employed by Blue Chip. With Lee's assistance, Moser contracted to purchase the property contingent upon his acquisition of financing by July 20, 1988. Moser was unable to secure financing by this date and the seller granted him an extension... Moser failed to secure the necessary financing by the new deadline, and the agreement terminated. Approximately......

Words: 1449 - Pages: 6

Premium Essay

Business Law

...damages are generally broken down into special damages and general damages. Special damages compensate the plaintiff for quantifiable monetary losses (medical expenses, lost wages).General damages compensate individuals (not companies) for the nonmonetary aspects of the harm suffered, such as pain and suffering( physical and emotional pain and suffering, loss of companionship, loss of reputation..) Punitive damages are appropriate only when the defendant’s conduct was particularly egregious (reprehensible). Usually, this means that punitive damages are available in intentional tort actions and only rarely in negligence lawsuits. 2.   What is defamation? Defamation of character involves wrongfully hurting a person’s good reputation. The law imposes a general duty on all persons to refrain from making false, defamatory statements of fact about others. Breaching this duty in writing or in another permanent form involves the tort of libel. Breaching this duty orally involves the tort of slander. 3.   What is fraudulent misrepresentation? What is appropriation of one’s likeness? A misrepresentation leads another to believe in a condition that is different from the condition that actually exists. Although person sometimes make misrepresentations accidentally because they are unaware of the existing facts, the tort of fraudulent misrepresentation or fraud, involves intentional deceit for personal gain. Appropriation of one likeness is also called as appropriation of identity:......

Words: 4939 - Pages: 20

Premium Essay

Business Law

...“contract” actually is? There are many definitions of contract from different sources. According to www.inbrief.co.uk, the website which helps with life’s legal issues defines the term contract as “an agreement between two or more parties.” While the term “contract” is defined as “an agreement giving rise to obligations which enforced or recognized by law” in the book Basic Principles of English Contract Law. In Malaysia, our contract law is basically governed and enforced by the Contract Act 1950 therefore according to Contract Act 1950, Section 2(h), contract is defined as “an agreement enforceable by law.” Under section 10(1) in Malaysian Contract Law 1950 says that “all agreements are contracts if they were made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void.” Basically there are 3 types of contract which are valid contract, void contract and voidable contract. For a contract to be valid, there are few necessary elements to be included. The first element of valid contract is an offer. Under section 2(a) Contract Law 1950 offer is “when one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other person to the act or abstinence, he is said to make a proposa.l” For example: Dashila told Jasni that she is willing to sell her Mitsubishi Pajero Sport to Jasni for RM80, 000. In this......

Words: 5958 - Pages: 24

Premium Essay

Business Law

... origin, age, etc.) *Public policy: whistle-blower Principal: Employer Agent: Employee If the 3rd parties sell something less than agent asked, or the 3rd parties sell something at a lower price set by agent, employer can sue agent still. Differences between Independent contractor & Employee: 1. Liability (torts: legal wrong) a. Employer is liable for employee’s torts, but not for IC 2. Tax: FICA (employees) – employer has to match the tax amount b. No income taxed paid by IC 3. Benefits: only employees are able to receive benefits (health insurance, dental, etc.), IC will not be able to receive benefits from employers. 4. Cost savings: sometimes cheaper to hire IC (IC brings own tools, facilities, etc.) 5. Laws: some laws only apply to employee (minimum wage/overtime employees) What is IC? Independent/contract-based/by the job (ex. Housepainter) What is employee? Work for employer consistently, salary/wage, employer furnishes tools What happen if you mislabel the agent? Label pulls little weight. If a company mislabel: * 1099(if an agent file this): employer will report income at the end of year, pay the full tax amount missed, 20% of the tax amount, 15% of employee’s wage * If no 1099 reported: employer will pay full amt. missed, 40% of tax amt. 30% of employee’s wage How to determine Employee or IC? 1. Common-law agency test: looking at the control that employer has over the potential......

Words: 592 - Pages: 3

Premium Essay

Business Law

...Business Law & Taxation EASY ROUND 1. Which of the following individuals shall not be subject to the income tax under Section 24 (A)? |D |a. |Individual citizen of the Philippines residing therein; | | |b. |Individual citizen of the Philippines who residing outside the Philippines including overseas contract workers; | | |c. |Individual alien who is a resident of the Philippines; | | |d. |Individual alien who is not a resident of the Philippines. | 2. Which of the following income is not from a related trade, business or activity of a domestic proprietary educational institution? |A |a. |Income from rent of available office spaces in one of the school buildings | | |b. |Income from the hospital where medical graduates are trained for residency | | |c. |Income from the canteen situated within the school campus | | |d. |Income from bookstore situated within the school campus | 3. How much is the......

Words: 2758 - Pages: 12

Premium Essay

Business Law

...* TCO A Contract – an agreement that is enforceable by a court of law or equity. Also, a contract is a promise or a set of promises for the breach of which the law gives a remedy or the performance of which the law in some ways recognizes a duty. Sources of contract law include the Common Law of Contracts (developed primarily by state courts) and the Uniform Commercial Code (UCC) which is a comprehensive statutory scheme that includes laws that cover aspects of commercial transactions. Elements of a Contract: 1. Agreement – between parties, requires an offer and an acceptance, and mutual assent. 2. Consideration – EX: money, personal or real property, provision of services. 3. Contractual Capacity – have to have the ability to enter into the contract – have to be sane. 4. Lawful Object – can’t be an illegal contract, or involve illegal duties/sutf. Two defenses may be raised to the enforcement of contracts: 1. GENUINENESS OF ASSENT – The consent of the parties to create a contract must be genuine. If the consent is obtained by duress, undue influence, or faud, there is no real consent. 2. Writing & Form – certain contracts have to be in writing to be enforceable. Types of Contracts – Summary on pg 161-162 1. Bilateral Contract – an exchange of promises of the parties, “a promise for a promise.” 2. Unilateral Contract – Offer can be accepted only by the performance of the act by the offeree, “a promise for an act.” ...

Words: 3814 - Pages: 16

Premium Essay

The Relationship Between Principals and Agents in Business

...The Relationship between Principals and Agents in Business BUS311: Business Law I (BNJ1151A) Prof. Samantha Hodapp January 30, 2012 The Relationship between Principals and Agents in Business The relationship between a prinicipal and agent in business can and have been great; benefitting both parties involved while providing the best services or products to the consumer. Many businesses, or prinicipals, use an agent, such as an employee or sales representative, to represent the business when dealing with third-parties, also know as the consumer or client. For the sake of this writing this relationship will be based on the principal (A.O.I.), special agent(s) (sales representatives) and third-parties (clients). A special agent is a person delegated to act only in a particular transaction, under definite instructions, and with specific limits on the scope of his or her authority. (Liuzzo, 2009, pg. 259) An example in this case would be a sales representative who has authority to negotiate the price of a sale to a limit predetermined by the principal. Another example of prinicipal and agent relationships is GNC who argued that the conduct of McCreadies was sufficient to represent they had authority to enter a binding agreement on behalf of O2. McCreadies was hired by O2 to negotiate the terms of the contract and GPN argued that agents are commonly used to negotiate and enter into contracts and that O2 had at no time informed them of any restrictions of McCreadies’......

Words: 2646 - Pages: 11

Premium Essay

Business Law

...contracts namely- 2 There are five implied terms under the sales of goods act 1979, they are 2 Task 2: 5 EX: 5 RIGHTS OF AGENT or DUTIES OF A PRINCIPAL :- 5 DUTIES OF AN AGENT :- 6 Advising Rosy whether she will be bound by the contract with Yasmine: 7 References:- 8 TASK 1:-  A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price. There may be a contract of sale between one part-owner and another. There are two types of contracts namely- * Express contracts- In an express contract, the parties state the terms, either orally or in writing, at the time of its formation. There is a definite written or oral offer that is accepted by the offeree (i.e., the person to whom the offer is made) in a manner that explicitly demonstrates consent to its terms. * Implied contracts- Although contracts that are implied in fact and contracts implied in law are both called implied contracts, a true implied contract consists of obligations arising from a mutual agreement and intent to promise, which have not been expressed in words. It is misleading to label as an implied contract one that is implied in law because a contract implied in law lacks the requisites of a true contract. The term quasi-contract is a more accurate designation of contracts implied in law. Implied contracts are as binding as express contracts. An implied contract depends on substance for its existence;......

Words: 2174 - Pages: 9