Distinguish between an Agent and a Sub Agent in Contract

Just as final contracts that establish a relationship between the agency are very common in business law. Because these can be explicit or implicit. Thus, an agency is created when a person delegates his authority to another person, that is, asks him to do a certain job or a series of them in certain areas of work. In addition to establishing a relationship between the principal and the agent, rights and obligations are transferred to both parties. There are various examples of such a relationship is an insurance agency, advertising agency, travel agency, postmen, brokers, delcredere agents, etc. However, as with the transfer of rights or the imposition of responsibilities on a third party, it may represent third parties. Section 195 of the Indian Contract Act, 1872 speaks of the agent`s obligation to designate such a person. This article imposes on the representative the obligation to choose a person as an alternate representative with the prudence exercised by an ordinary reasonable man in a similar case. If the original representative exercises such caution, he or she is not liable to the client for the negligence or any other act of the substitute agent. Prior to the Judgment of the Court of Appeal, the High Court had considered the position of the sub-agents in this case. The High Court ruled that under the regulations, sub-agents can claim compensation from the principal (not the agent). The difference between the subagent and the substituted agent is very basic and important.

Therefore, if the person as an agent is asked to appoint someone for a specific task, the designated person does not become a sub-representative of the client, but a replacement representative in the contract. 3. Contract: There is no direct contract between the sub-agent and the client, whereas there is a direct contract between the substitute agent and the client. For this reason, it is important that all principals and agents understand the principal-agent relationship and work in a mutually beneficial manner. For agents or brokers, it is crucial to act ethically and make decisions that benefit both parties. The only English court ruling reported so far does not make the situation clearer. In its decision, the Court of Appeal held that an agent involved in the management of a number of sub-agents may, under the Regulations, have a claim against the principal and that the claim relates to the success of the agent and sub-agents in obtaining orders for the customer`s products. The agency is a matter of authority, which is the authority by which the agent acts on behalf of the client. The client is responsible for all actions of the agent under his responsibility. It is based on the Latin maxim Qui facit per alium facit per se, which means that someone who acts through another performs the action himself. The agent is considered an exception to the doctrine of contractual confidentiality, as he can acquire rights and incur responsibilities on behalf of the client.

The entrepreneur is entitled to enter into a contract on behalf of the customer and the customer can sue or be sued on the basis of this contract. The Agency can be formed in four ways: actual authority by contract, ratification by the client, forfeiture by conduct and by authority implied by law. The original agent employed the sub-agent, who works under his control and authority. The relationship between the original agent and the sub-agent is that of the principal and the agent. All the rules that govern the agency automatically govern the relationship between the sub-agent and the agent. The same rights and responsibilities can be created by the subagent on the original agent as by the agent on the client. 3. A client may not directly sue the sub-agent unless the sub-agent has been duly appointed and intentionally commits wrongdoing or fraud. It is important to understand the difference between the two, because their responsibility is different: the power to appoint such deputies is implicit when the nature of the transaction or by the application of business practices can reasonably be presumed. If the agent is accepted by the principal and confidentiality between them is established, the original representative does not deal with the business transaction between the agent and the principal (see Purushotham Haridas v. Amruth Ghee Co Ltd and see Central Bank of India Ltd v.

Firm Rurchand Kurramal). It is not concerned with the effectiveness, character or negligence of the surrogate agent (see Gambhirmull Mahabirprasad v. Indian Bank Ltd). The original agent cannot be held responsible for the behaviour of the substituted agent once the relationship between the principal and the substituted agent is established (see Chowdhury TC v. Girindra Mohan Neogi, 1930 Calcutta HC). .