Eight Important Duties of an Agent Towards the Principal Essay

1. trade to follow straitss turn toions or traditions (Sec. 211) The first duty of every ingredient is to flirt within the scope of the say-so conferred upon him and perform the agency work fit to the directions given by the principal. When the agent acts otherwise, if all told loss be sustained, he must(prenominal) switch it well-grounded to the principal, and if either profit accrues, he must account for it. Illustrations (a) Where the principal instructed the agent to wareho subr startine the goods at a detail fleck and the agent warehoused them at a different warehouse which was equally safe, and the goods were destroyed by fire without negligence, it was held that the agent was liable for the loss because any departure from the instructions sheds the agent absolutely liable (Lilley vs Doubleday). (b) An agent macrocosm instructed to insure goods neglects to do so. He is liable to compensate the principal in the event of these being lost (Pannalal Jankidas vs M ohanlal).If the principal has non given any express or implied directions, then it is the duty of the agent to follow the custom prevailing in the same kind of business at the place where the agent conducts business. If the agent makes any departure, he does so at his take risk. He must make good any loss so sustained by the principal.Illustrations (Appended To Sec. 211) (a) A, an agent, engaged in carrying on for B a business, in which it is the custom to invest from time to time at involvement, the moneys which may be in hand, omits to make such investments. A must make good to B the interest usually obtained by such investments. (b) B, a broker, in whose business it is non the custom to swap on credit, sells goods of A on credit to C, whose credit at the time was very high. C, originally payment, becomes insolvent. B must make good the loss to A, irrespective of his good intentions. 2. traffic to carry out the work with reasonable skill and industry (Sec. 212) The agent must conduct the business is generally possessed by persons engaged in similar business, unless the principal has nonice of his want of skill. Further, the agent must act with reasonable diligence and to the best of his skill.If the agent does not work with reasonable care, skill (unless the principal has notice of his want of skill) and diligence, he must make requital to his principal in respect of direct consequences of his give birth neglect, want of skill or misconduct. But he is not so liable for indirect or remote losses. Illustrations (Appended To Sec. 212) (a) A, a merchandiser in Kolkata, has an agent B, in London, to whom a sum of money is pay on As account, with orders to remit. B retains the money for a appreciable time. A, in consequence of not receiving the money, becomes insolvent. B is liable for the money and interest from the day on which it ought to switch been paid, according to the usual rate, and for any moreover direct loss such as loss by division of rate of exchange, but nothing further.(b) A, an agent for the sale of goods, having authority to sell goods on credit, sells to B on credit, without making the proper and usual enquiries as to the solvency of B. B, at the time of such sale, is insolvent. A must make compensation to his principal in respect of any loss thereby sustained. 3. Duty to Render Accounts (Sec. 213) It is the duty of an agent to keep proper accounts of his principals money or property and render them to him on demand, or periodically if so provided in the agreement. 4. Duty to communicate (Sec. 214) It is the duty of an agent, in cases of difficulty, to use all reasonable diligence in communicating with his principal, and in quest to obtain his instructions, before taking any steps in veneering the difficulty or emergency. 5. Duty not to deal on his aver account (Sees. 215 and 216)An agent must not deal on his own account in the business of agency i.e., he must not himself buy from or sell to his princip al goods he is askedto sell or buy on behalf of his principal without obtaining the consent of his principal after disclosing all literal facts to him. If the agent vio tardilys this rule, the principal may repudiate the transaction where it good deal be shown that any material fact has been knowingly concealed by the agent, or that the dealings of the agent have been disadvantageous to the principal. The principal is in like manner entitled to claim from the agent any benefit which may have resulted to him from the transaction. Illustrations (a) A, directs B to sell As estate. B buys the estate for himself in the name of . A, on discovering that B has bought the estate for himself may repudiate the sale, if he can show that B has dishonestly concealed any material fact or that the sale has been disavantageous to him. Illustration (a) Appended to Section 215 (b)A directs, B, his agent, to buy a plastered house for him. B tells A that it cannot be bought and buys the house for hi mself. A may, on discovering that B has bought the house, compel him to sell it to A at the price he gave for it. Illustration appended to Section 2166. Duty not to make any profit out ofhis agency except his honorarium(Sees. 217 and 218)An agent stands in a fiducialrelation to his principal and thereforehe must not make any profit (secretprofit) out of his agency. He mustpay to his principal all moneys(including illegal gratification, if any)received by him on principalsaccount.He can, however, deduct all moneysdue to himself in respect of hisremuneration or/and expensesproperly incurred. If his acts are notbonafide, he will draw back hisremuneration and will have toaccount for the secret profit to hisprincipal.7. Duty on termination of agency byprincipals final stage or insanity (Sec.209)When an agency is terminated by theprincipal decease or becoming ofunsound mind, the agent must take,on behalf of the representatives ofhis late principal, all reasonablesteps for the protectio n andpreservation of the interestsentrusted to him.8. Duty not to delegate authority(Sec. 190)Subject to six exceptions statedearlier (under the verandah Delegationof Authority), an agent must notfurther delegate his authority toanother person, but perform the workof agency himself.