Legal Aspects of Business: Agency Law, Authority, and Legal Principles

This report examines the legal aspects of business, with a specific focus on agency law. It delves into the fundamental concepts of agency, including the agent-principal relationship, and explores various types of agency, such as agency by agreement, ratification, estoppel, and operation of law. T...Read More

Legal aspects of
business

Table of Contents
INTRODUCTION
MAIN BODY
CONCLUSION
REFERENCES

INTRODUCTION
Knowing all the legal aspects of any business is very essential for both the parties in any
agreement or a contractual basis work. Involving legal perspective makes all the decisions by
into law and in any case of breach or misconduct of work The Innocent party can always claim
there loss of pay. The agent principal relationship is a very commonly used term and most of the
globalization business works on the doctrines of agency. The file refers to all the important
aspects which are credentials of this basic term and have to be authorized and legally binding in
nature. The file consists of all such aspects and give the brief gist of agency law.
MAIN BODY
To understand the basic concepts and laws in the file one has to work as per doctrine of estoppel,
it says that its a very popular remedy and working method which has developed since several judicial
evolution areas. Their are three main types of it which is estoppel by deed and equitable also their is
estoppel by conduct. The basic meaning of the term agency means a consensual relationship which is
created either by a contract or by a binding law in which one party is the principal, who grants the
authority for doing business with another party then the agent comes in and act either in the behalf of
principal or works under the proper control and discipline of principle and does the deal with the third
party. In United kingdoms the commercial agents regulation 1993 are the UK proper implementation of a
European directives. Agent also have prominent types it can either be a general agent, special agent,
agency coupled for an interest, a servant or an employee and the subagent ( Andersen, 2018).
Key features of agency relationship.
Agency relationship consists of several key factors and some of them are mentioned below:
1. Agency by agreement or contract: this is directly connected to the implied relation or contractual
consent which is between both the parties. In this the agent in both parties acts as principle in
their deal. In several cases there is only limited number of members and thus it only stays as an
agreement. The one of the most basic benefits of having in agency agreement is that the principal
and especially what happens to a small business owner. The special skills which are needed for a
professional to act and behave as an agent saves a lot of time for the businessman and conduct
several other things which are required in the business this this concept is very much well
efficient and time saving plus the agency is much more human resource function than the owner
himself. There are also some risk which are attached in some agency agreement that either even
in the necessity of agency for the legal relationship which stands between the principal and agent
can be held liable in several cases where misconduct has happened and in several cases the
principal is always held liable for the decisions which are taken by the agent.
2. Agency by ratification : this is giving completer authority by the main principal in which contract
is performed or is agreed upon on behalf of other person. In this it is assumed that, without

correct authority for acting as an agent in agreement, request for a valid ratification needs basic to
terms the first hear the agent should have and purpose of act or for principal who is either
contemplated in his identity or has a time based contract II the principal should be in existence at
the time of such contract. Then only the proper ratification of agency will be conducted or else it
will be coming under the breach of contract or a null contract.
3. Agency by estoppel: In this case if the principal is holding his deed to neutral third person or
party, and they are held up to act in the behalf of them. In this case whomsoever is provided for
third party deals with other person as per contractual agreement. This concept works when any
third person is acting to make the front party believe that this person is authorized for taking
decision on their behalf. This will implement in contract as they enter on such grounds. This is
clearly based upon the principal of equity & natural justice. In any agent principal relation here,
agent acts as if the whole scope of employment will be legally bind towards principal of his acts.
If such acts were perceived they will be apparent authority in whole case, so that it can be decided
that his acts are in range of his authority and duties or not. Its very important to have full
agreement from both sides and they should agree to all terms and conditions in agreement. Once
verbal and written agreement is done they cannot argue in fact ( Ghanavati and Hulstijn,
2015).
Relevant case law to understand estoppel: Burnt cotton case of 1963, in this T had a deal with A, who is
the agent of P to sell him 144 bales of cotton. The deal was locked under 40 cents per pound. Just before
some of the cotton was to be put in boat it got burned. P had already instructed his agent A to buy it in
average rate of 30 cents per pound. In this case since the instructions were violated and p had to suffer
due to his agents loss, p was held to be liable or not. In this case scenario the court of justice in us
supreme court decided the that P has to pay fro the loss and cannot question A about it. This was for the
fact that due to the deal between first and third party the second party did not make it clear and wanted
to be anonymous plus in case expressed authority was given to them and to be a general agent he had to
buy the goods as per market price and all things included. So here has to pay fo0r the loss incurred.
4. Agency by operation of law: theses places are legally bind and approved by the court and have to
be providing correct guidance and regulations in the hands of correct working criteria. These are
recognized by courts of justice for example such as family relationship or any sort of emergency
situations. These are generally employed without any direct reference to search agreement of a
principal and agent this is basically the work of an insurance agent or a bind principal. The clear
example of such agreements is the certain insurance agents where they have a certain power of
mind with the principal but do not really have a clear terms and condition of the actual agreement
been done with third party.
5. Agency of necessity: This is not that common agency type but generally it is implied by law for
an emergency situation where there is no sign of the principal getting in between of the contract
and the agent has to take care of the situation where here they can take a decision which have to
be an emergency case and the rules and regulations applied over your will be accepted in the
contract ( Ha, 2017).

Provide several types of agents authority : In basic terms there is only two types of authority
which is generally recognized by the law first actual authority and second apparent authority it
can be either implied or expressed. The basic term of authority means when any agent which
works with the scope of authority given by the principal which is bounded by law and the
obligation agent creates with any third party. These two types of authorities are explained below:
 Apparent authority: in this type of authority the principal words have to be existing or
conducted, which leads to a conclusion when dealing with the third party it is believed that the
agent is already authorized by the principal even if the agent and the principal have not discussed
such a relationship for example in any case where some person is hiring a person for a position
which carries an agency like authority the one who are for the appointment are entitled for
assuming that there is apparent authority to do all these things generally interested to be one
person in such position. The term agency by estoppel are the basic doctrine of holding out means
where principal will be stopped from the 9 any authority grant decision if the third party have
changed their position or are determined in relying on the first presentation made by the agent
( Herlambang, and Setyawan, 2018).
Actually authority: this is authority has to wait ways of working either the principal might have had
expressed or conferred the authority for The agent or authority may be directly implied on the agent. The
authority your might arise by the consent for it is already existing like a fact in the agreement. In this case
the agent has to work as per the boundaries maintained by the principal in any case the agent tries to
oversee or push over the boundaries or terms given by the principal then it might be in the term of breach
of contract where the liable party which is the third party for breach might implied warranty of authority.
These also have to more bifurcations which is Express and implied actual authority in Express actual
authority is generally means that the agent is been expressed and told that they might act on the behalf of
the main principle. Implied actual authority it’s called the usual casual authority where an agent by virtue
should carry all duties of principal. this can also be implied by the position the agent holds in front of the
principal and the organization ( Znikin, and Zharikov, 2018).
Apparent authority and its essential elements: this authorities is basically the power and agent
comprises to act on behalf of the principal either it should be expressively or impliedly granted
by the principal. Search for our skin only arise in particular reasonable conditions where if third
party is inferred and the conduct from the principal is missing here the agent interferes and acts
on the behalf of principal regarding all the contractual agreement of principal and third party
generally in a case where the agent has apparent authority the principal who has hired such agent
will be e Court liable for any repercussions done by the agent because of the grant of authority.
This term is generally used in agency law and arises when someone has no 30 for giving
instructions for in matter of contract or stationery form for the logo of a company CEO in the
middle and agent works for the principal acting as the principal in dealing terms with the third
party this is a binding and legal term on the company for any goods or services provided by the
agent ( Bank, 2015).
Essential elements of apparent authority which have to be clearly defined and made clearly in the
terms and condition of the relationship between principal and agent for the agent and third party
for the third party and principal:
 It has basic two three terms which have to be fulfilled first the coordination between the principal
and the agent near the things implied or expressed between both these parties should be very clear

and contractual since in any of the cases the principal will be held liable if the third party tries to
ID change their position or they won the principal direct representation in the contract. In general
terms the principal cannot held the contract back if there are any repercussions in the contract
which is done by his own agent.
 There is a term called emergency powers which is generally used on very rare circumstantial
situation. In this if any unforeseen scenario arises and actually demands for a protect or preserve
the property in the condition then there are direct rights in the hand of principle. This can only be
performed by the principal.
These are the basic term which works is either a word or action which causes or makes third party think
that the agent has authority or power act on behalf of principal ( Boguslavski. and et. al., 2019).
Refereed case law for understanding basic things Rama Corp Ltd v Proved Tin and General
Investments Ltd [1952] 2 QB 147 (QBD): is one of the most landmark cases in the agency law
of English law which deals with all the repercussions which are found in such principal and
agent relationship. this case law justifies the actual statement of cost and ability or a parent
authority is nearly of form of estoppel in the it has been term agency by estoppel in one cannot
call in aid of estoppel unless unless three of the most prominent ingredients are present in the
case law first is the representation of all the facts and figures second whatever reliance of
representation are provided by the parties and the third opposite or an alternate solution or a
position resulting from the current reliance in the parties. In this case law the planted had a
contracted with defendant which gave a check under the contract. This could have had been done
directly but apparently as per the fact it was not. In this case the planters did not read the articles
prop factors which are used in the relationship of a principal and agent and third party are particularly
and briefly define. It has early and in the end the director had a misappropriated cheques signed for
the planters and the plant is in this case so the directors and of the case the judgement came that
the directors were not held liable as it was just outside their capacity of authority in the contract
(Kemp, 2018).
CONCLUSION
The conclusion result of this file or essay revolves around the agency law of United States. your
most of these explained several elements through case laws. Also what are the main elements
and the causality which is required while being in an contract. Also the agent authority and it's
prominent elements are explained briefly. The key features of agency relationship are also
explained plus the key role of all such types and elements is also provided in the above
mentioned file.

REFERENCES
Books and journals
Andersen, C., 2018. Legal Aspects of Asset Valuation on Copyright as Part of Boedel
(Countable-List) in the Process of Bankruptcy in Indonesia Following the Latest Copyright Law
Act No. 28/2014. Central European Journal of International & Security Studies. 12(4).
Ghanavati, S. and Hulstijn, J., 2015, May. Impact of legal interpretation on business process
compliance. In Proceedings of the First International Workshop on TEchnical and LEgal aspects
of data pRIvacy (pp. 26-31). IEEE Press.
Ha, H.T.H., 2017. Legal aspects of pension product-review of the client's rights and tax
incentives related to voluntary pension insurance business.
Herlambang, D. and Setyawan, D.Y., 2018, October. LEGAL ASPECTS OF BUSINESS
COMPETITION ON ELECTRONIC COMMERCE. In Prosiding International conference on
Information Technology and Business (ICITB) (pp. 107-111).
Znikin, V. and Zharikov, E., 2018. Legal Aspects of Industrial Enterprise Security in Mining
Region. In E3S Web of Conferences (Vol. 41, p. 04018). EDP Sciences.
Bank, R., 2015. Modern security paradigm of business activity: administrative and legal aspects.
Administrative law and process. (1 (11). pp.73-79.
Boguslavski, M. M. and et. al., 2019. The Reorganization of Soviet Foreign Trade: Legal
Aspects: Legal Aspects.
Kemp, R., 2018. Legal aspects of cloud security. Computer Law & Security Review. 34(4).
pp.928-932.

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