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Nature of an Agency Agreement & Types & Duties - Coggle Diagram
Nature of an Agency Agreement
& Types & Duties
The Agent - someone who is employed by a principal to carry out certain transactions on his behalf.
The principal - who employs the agent to enter into contracts on his behalf
Third party - introduced into contractual relations with the principal by the agent.
Types of agent
General Agent
Has authority to enter into any contract
on behalf of his/her principal
Special Agent
Has authority to contract on behalf of it's principle but
Only for a specific purpose
Only on a particular occasion
Del Credere Agent
May be special or general but has an additional power or obligation as part of his contract with the principal.
This agent will guarantee the payment or performance of the contract irrespective of whether or not he is paid
Rights and Duties of an agent
To act as an agent,
· To act with skill, care and diligence,
· Not to delegate unless this is approved by principal in advance or required in order to complete the task,
· To act within ostensible authority and with reasonable care,
· To retain confidentiality,
· Not to take a secret, bribe or profit.
Authority of Agents
Ostensible
, or implied
or apparent authority
Anything that is reasonable to expect the agent to be able to do on behalf of his principal.
Actual
Indicate special levels of authority, which may exceed or be less that ostensible authority
Breach of Warranty
when an agent exceeds his ostensible, apparent, or implied authority
· By acting negligently
· By failing to account to the principal
· By exceeding his ostensible authority
· By delegating without authority
· By taking a secret profit or bribe.