PPT: Agency | Business Laws for CA Foundation PDF Download

 Page 1


Definition of Agent & Principal
?
An agent is a person employed to do any act for 
another or to represent another in dealings with third 
persons.
?
The person for whom such acts are done or who is 
represented is called the principal.
?
The contract which creates relationship of principal & 
agent is called an agency.
Page 2


Definition of Agent & Principal
?
An agent is a person employed to do any act for 
another or to represent another in dealings with third 
persons.
?
The person for whom such acts are done or who is 
represented is called the principal.
?
The contract which creates relationship of principal & 
agent is called an agency.
Essentials and legal rules
1. There should be an agreement between the principal and 
the agent :Agreement may be: Express or implied
2. The agent must act in the representative capacity.
3. The principal must be competent to contract.
4. The agent need not be competent to contract. Why? But in 
the interest of the principal?
5. The consideration is not necessary.
 
Page 3


Definition of Agent & Principal
?
An agent is a person employed to do any act for 
another or to represent another in dealings with third 
persons.
?
The person for whom such acts are done or who is 
represented is called the principal.
?
The contract which creates relationship of principal & 
agent is called an agency.
Essentials and legal rules
1. There should be an agreement between the principal and 
the agent :Agreement may be: Express or implied
2. The agent must act in the representative capacity.
3. The principal must be competent to contract.
4. The agent need not be competent to contract. Why? But in 
the interest of the principal?
5. The consideration is not necessary.
 
General rules of agency 
1. Whatever a person can lawfully do himself, he may 
also do the same through an agent
2. He who acts through another, does by himself
Distinction b/w agent & servant.
Page 4


Definition of Agent & Principal
?
An agent is a person employed to do any act for 
another or to represent another in dealings with third 
persons.
?
The person for whom such acts are done or who is 
represented is called the principal.
?
The contract which creates relationship of principal & 
agent is called an agency.
Essentials and legal rules
1. There should be an agreement between the principal and 
the agent :Agreement may be: Express or implied
2. The agent must act in the representative capacity.
3. The principal must be competent to contract.
4. The agent need not be competent to contract. Why? But in 
the interest of the principal?
5. The consideration is not necessary.
 
General rules of agency 
1. Whatever a person can lawfully do himself, he may 
also do the same through an agent
2. He who acts through another, does by himself
Distinction b/w agent & servant.
Conti…
?
Who may employ an agent?
Any person who is of the age of majority according to the 
law to which he is subject, and who is of sound mind, 
may employ an agent.
?
Who may be an agent?
As between the principal and third persons any person 
may become an agent
Page 5


Definition of Agent & Principal
?
An agent is a person employed to do any act for 
another or to represent another in dealings with third 
persons.
?
The person for whom such acts are done or who is 
represented is called the principal.
?
The contract which creates relationship of principal & 
agent is called an agency.
Essentials and legal rules
1. There should be an agreement between the principal and 
the agent :Agreement may be: Express or implied
2. The agent must act in the representative capacity.
3. The principal must be competent to contract.
4. The agent need not be competent to contract. Why? But in 
the interest of the principal?
5. The consideration is not necessary.
 
General rules of agency 
1. Whatever a person can lawfully do himself, he may 
also do the same through an agent
2. He who acts through another, does by himself
Distinction b/w agent & servant.
Conti…
?
Who may employ an agent?
Any person who is of the age of majority according to the 
law to which he is subject, and who is of sound mind, 
may employ an agent.
?
Who may be an agent?
As between the principal and third persons any person 
may become an agent
Agent Servant
He has the authority to 
create commercial relationship 
between the principal & the 
third party
He ordinarily has no such 
authority.
He may work for several 
principal at a time.
He ordinarily work for 
only one master at a time.
He usually get commission He usually get salary or 
wages.