Agency and features of agency



The agency relationship is explained in the Indian Contracts Act, 1872, from the sections 182 to 236. The agent and principal is defined under Sec -182, “An agent is a person employed to do an act for another, or to represent another in dealing with the third persons. The person who represents is called Agent and the person to whom the act is done is called Principal.

Essentials of Agency:

1) The agent here is just a connecting party, and the contract is always between the Principal and the third party only in the eye of law.
2) The Principal who may appoint his agent must be competent according to the sec-183, he must be the age of majority and of sound mind. (Physical and Mental conditions)
3) The Agent can be any person, but no person who is not of sound mind and majority of age can become an agent, and so as to be responsible to his principal as per the provisions made – sec 184 of Indian Contracts Act, 1872.
4) The consideration is not necessary for creation of agency relationship – sec 185 of Indian Contracts Act, 1872.
5) But the agency relationship can be made by the way of commission for services rendered, but no such consideration is necessary as per sec 185 of Indian Contracts Act, 1872.