Present Case Is Offer A Legal Advice Frank â€Myassignmenthelp.Com

Question: Discuss About The Present Case Is Offer A Legal Advice Frank? Answer: Introducation Agency is a special type of financialagreement between the two parties where one party called as principal has extended some legal authority to other party called agent to create legal contract with the third party on behalf of the principal. Hence, it can be said in agency law mainly three parties are involved i.e. Principal, agent, third party (Pont, 2008). When agent with sufficient authority has enacted a contract with the third party, then in such cases the contractual obligation becomes binding on the principal. The principal is liable to fulfill the contractual duties for the third party only when the agent who has enacted the contract with the third party has the requisite authority (Cassidy, 2013). If any of the below highlighted authority exists with the agent, then the contractual liability is valid on principal. Customary / Actual authority (Express Implied authority) Authority of necessity Ostensible/apparent authority Actual authority When the principal has extended the authority to agent in written form or in oral form, then it would be termed as express authority. Further, when the principal does not actually express the authority but has extended the position/designation/ title to perform some work, then in such cases it has been assumed that agent has the authorization to perform the work on behalf of the principal (Edlin, 2007). The leading case in this regards is Watteau v Fenwick[1893] 1 QB 346 case. In such cases, it is essential that the respective principal has informed the third parties regarding the level of authorization of the agent (Harris, 2014). Ostensible/apparent authority In such authority, the principal does not aim to give authority to agent but due to his action the third party assumes that the agent has authorization. The conduct represents that the agent has legal authority to enact the contract with third party and hence in such cases, the contractual obligation is applicable on principal. Freeman Lockyer v Buckhurst Park Properties[1964] 1 All ER 630 case is the testimony of this aspect (Pathinayake, 2014). Authority of necessity The agent has performed some acts with the third party in order to protect the interest of the principal. The judgment given in Great Northern Railway Co. vSwaffield(1874)LR 9 Ex 132 case is the example of agency of necessity. When any of the above authority is not extended by the principal to the agent, then in such cases, Management is not liable to complete the contractual obligation with the third party. The Yonge v Toynbee[1910] 1 KB 215 case is the testimony of this. There are some duties of the fiduciary parties of the agency relationship which are furnished below (Pont, 2008): Duty of agent towards the principal Follows the instruction of principal If not then the principal has legal rights to recover the damages from agent or sue agent) Fiduciary duty It is pivotal that agents conduct must indicate good faith of the principal. The main factors are shown below (Harvey, 2009): If it has been found that agent has made contract for his own interest, then principal can sue agent and claim for damages as given in Christie v Harcourt[1973] 2 NZLR 139 case. Agent is not supposed to make secret profit on behalf of principal as highlighted in Bentley v Craven(1853) 52 ER 29 case. Misuse of confidential information by the agent as per Robb v Green[1895] 2 QB 315 case. If the agent has breached the fiduciary duties, then principal has the rights to sue the agent and recover the losses. It is noteworthy that when the principal has not informed the third party regarding the withdrawal of any authority from the agent and the agent has enacted the contract with the third party, then in such cases the interest of the third party would be protected under common law. Also, the principal is liable to satisfy the contractual obligations directed towards the third party. If principal denies doing so, then the third party can sue the principal or claim for the damages (Edlin, 2007). Application It is apparent from the case facts that Frank (the principal) has appointed Gemma as a salesperson for his shop. Gemma is working as a sales agent for Frank which means she has the authority to sell the appliances to customers on behalf of Frank. Also, Tom is the customer who is ready to buy a dishwasher for $350 has informed Gemma about the same. However, Gemma has called her niece and has sold her dishwasher for $300. She does not inform Frank about this case and later on Tom has informed about the same to Frank. It can be seen that Gemmas has conducted the work for personal interest and has breached the fiduciary duty. Therefore, Frank can recover the damage of $50 from her. It is apparent that Frank has authorized Bob to sell washing machines and to enact contract with laundries. However, due to Bobs late coming and drinking habit, Frank has fired Bob from job. Further, Frank has forgotten to inform the third party Angela regarding the withdrawal of duties from Bob. Hence, Angela was not aware that Bob does not have the requisite authorization and hence, she enacted the contract under good faith thereby transferring $10,000. Also, it is noticeable that Bob has the express authority to act accounting to Angela. Therefore, Frank has to complete the contractual responsibility or else Angela can sue him for breaching the contract. Conclusion It can be concluded from the above that Frank can sue Gemma for breaching the fiduciary duties and working for furthering her own interest. Hence, Frank can recover the damage of $50 from Gemma. In second case, Frank does not inform Angela regarding the withdrawal of authorization from Bob. Therefore, Frank is bounded with the contractual obligations with Angela which was entered by her in good faith. Reference Cassidy, J. (2013). Corporations Law Text and Essential Cases (4th ed.). Sydney: Federation Press. Edlin, D. (2007). Common law theory (4th ed.). Cambridge: University Press Cambridge. Harris, J. (2014). Corporations Law (2nd ed.). Sydney: LexisNexis Study Guide. Harvey, C. (2009). Foundations of Australian law (2nd ed.). Prahran, Vic.: Tilde University Press. Pathinayake, A. (2014). Commercial and business law (2nd ed.). Sydney :Thomson-Reuters. Pont D.E.G. (2008) Law of Agency (2nd ed.). Sydney: Lexis Nexis Butterworths. Answer: Duty of agent towards the principal Reference