Legal Aspects of Business

Legal Aspects of
Business

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................2
Critically discuss the statement...................................................................................................2
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Agency can termed as fiduciary relation which is creation between two person i.e.,
principal and Agent, where rights are given to agent for taking decision on behalf of principal
for the purpose of accomplishing the goals of an organisation (Agency Definition, 2019). This
types of relations are mainly developed by entering into the contract and it can be either in the
form of implied or expressed form. The main thing which is needed to consider with agency is
that any of the agent must perform only those work where they have been given permission. In
any of the situation, agent should not take those decision which can create issues for principal as
ultimate liability will be of principal .
The relation between agent and principal should be formed by legal procedure where
principal must give detail information about the rights and responsibility that agent has to
conduct. In present scenario, there are number of ways through agency can be formed such as it
can be commenced by taking the help of appointment. There is the option to form agency by
estoppel where implied appointment will be applicable. Also, there is the option to form it in the
manner of expressed contract. Here, both agent and principal have to decide about the authority
and action which they are allow to take for the welfare of particular organisation. Talking about
Tripartite relationship where relation is being creating among insurer, its insured and also
defence counsel which has been retained by the insurer for the purpose to defend the insured
against the third party claim (THE INSURANCE TRIPARTITE RELATIONSHIP WHO IS MY
CLIENT ANYWAY, 2017). It is the situation, where right is given to claim damages from third
party if insurer and insured party perform any of the unlawful activity.
Talking about the nature of agent/principal relationship, it can be simply expressed as the
situation where agent is given rights to take some of the decision which are crucial for the
business organisation. It is one of those decision which simply allow to reduce the overall burden
from principal . In addition, it has one of the most significant nature which allows agent to take
those decision through which chances of obtaining the business goal increases automatically. In
context of the file, various topics will be discussed which will have a directly link with topic that
are link with the relation between agent and principal . Some of the important aspects will
express about the duty of care and skill, the duty of avoid conflict of interest and many more.
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