Contract of Agency - Principal and Agent
A contract of agency is a legal agreement where one party, known as the principal, appoints another party, known as the agent, to act on their behalf in dealings with third parties. This relationship is governed by the Indian Contract Act, 1872, specifically under Sections 182 to 238. Definition of Contract of Agency According to Section 182 of the Indian Contract Act, 1872: An "agent" is a person employed to do any act for another or to represent another in dealings with third persons. The "principal" is the person for whom such act is done, or who is so represented. Relationship Between Principal and Agent The relationship between a principal and an agent is fiduciary, meaning it is based on trust and confidence. Here are some key aspects of this relationship: Authority of the Agent : The agent acts within the scope of authority granted by the principal. This authority can be express or implied (Section 186 and 187). ...