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Assignment on Commercial and Law of Agency

   

Added on  2020-04-07

9 Pages3036 Words107 Views
Commercial and Law of Agency 1COMMERCIAL AND LAW OF AGENCYNameCourseCourser InstructorUniversityCity StateDate

Commercial and Law of Agency 2From the facts given, it can be inferred that the law that is operational between Vera and Siddo is the law of contract. This can further be narrowed down to the law of agency. Panganiban J in the case of Pryce Corp vs Pagcorstated that so longest the contract has not been termited the parties are bound by theterms of the contract. The law of contract binds contracting parties as per the terms and conditions of the contract. It is only the contracting parties that are stating their rights and obligations between each other and the law allows them to contract the way they want. The law of agency is basically underpinned under the law of contract and it solely operates like the contracts. For the law of agency, there is the principal and the agent whereby there is an agreement between the two individuals that the agent will perform tasksand duties in accordance to the instructions advanced by the principal. DeMott (1997 p.1035) writes that an agent is tasked to act reasonably in good for faith for the benefit of the principal as I will be discussing in the subsequent paragraphs. The agent is only allowed to act within the scope of the instructions given. Where the agent has acted outside the scope of the instructions given the principal would either ratify thattransaction or he may refuse to ratify. The principal can sue the agent for breach of contract or for the tortof negligence when and if he contravenes the terms of agency. There are various statutes and case laws that address emerging issues in the law of agency or the contractual relationship between the parties involved. The key statutes are Auction Sales Act, Estate Agent Act, Consumer Credit Act, Travel Agents Act, Goods Act and Instruments act. I will discuss the facts given vis-à-vis case laws and applicable statutes.(Mc Carthy 2004 p. 2) reiterates that the law of agency is underpinned to the law of contract. In other words agency law come into existence vide an agreement between the principal and an agent whom he authorizes to act on his behalf. However the court in the case of Yasuda Fire & Marine Insurance v Orion Marine Insurance, differed and it stated that agency is a creature of contract. In the foregoing circumstance it can be established that there is a contractual relationship between Siddo and Vera. Vera isthe principal because it is her who is instructing while Vera is the agent since he is the one being instructed to act with a third party in accordance to the terms or instructions herein. It is therefore prudent for us to look various ways upon which agency can be created especially in light of the facts before us.

Commercial and Law of Agency 3Agency is herein created actually or expressly since the principal gives exact instructions to the agent to act in the specified manner as illustrated by the court in the case of Ex. Soil Recycling,Inc. v. Intercargo Ins Siddo. The court held that an agent requires an express or actual authority an agent in order to bind hisacts to the principal. Siddo who is the agent in this case is supposed to act within the scope of the instructions given otherwise he would not be deemed to be acting for Vera who is herein the principal. It is evident that the agent has acted contrary to the given instructions and has not acted within the scope of the instructions and thereby as things stand the agent is deemed not to have been acting for the principal. In the case of Williams v A & W Hemphill Ltd, the House of Lords stated that where the agent has acted outside the scope of the given authority, the master would not give effect to the mischief of the agent. In light of the above, the principal can bring a course of action against the agent. In addition to the above, an agency can be created impliedly. In light of the prevailing circumstances between Siddo and Vera it can be argued that agency has been created impliedly. An implied authority refers to a situation when an agent is acting reasonably in fulfillment of his actual authority as stated by the court in the case of ANZ Bank Ltd v Ateliers de Constructions. Therefore when an agent reasonably deems appropriate, he is supposed to act as though he is doing so vide the express instructions he received. In such an instance an agent ought to be acting only in the best interest of the principal. The case of Australia and New Zealand Bank v Ateliers de Constructions explains an instance when implied authority was assumed by the agent. In this case the agent was authorized to receive cheques for the principal. The agent obtained a cheque and he placed it to his account since the principal did not have an account in Australia. The issue to be determined by the court was whether the agent acted within the scope of the given express instructions or impliedly. The court found that the agent had acted impliedly in fulfillment of the laid down instructions and in the best interest of the principal. The court held that although there was no actual authority to act as such, the agent had authority to act impliedly and hence he rightly acted within the scope of his work.Notwithstanding Siddo’s contravention, Vera can ratify the acts of the agent even if it does not fall within the purview of the advanced instructions. In the case of Koenisblatt v Sweet the court held that

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