THE INDIAN CONTRACT ACT, 1872

Knowledge requisite for valid ratification No valid ratification can be made by a person whose knowledge of the facts of the case is materially defective. Practice area’s of B K Goyal & Co LLP Income Tax Return Filing | Income Tax Appeal | Income Tax Notice | GST Registration | GST Return Filing | FSSAI […]

Ratification may be expressed or implied —Ratification may be expressed or may be implied in the conduct of the person on whose behalf the acts are done.Illustrations(a) A, without authority, buys goods for B. Afterwards B sells them to C on his own account; B‟s conduct implies aratification of the purchase made for him by

Right of person as to acts done for him without his authority. Effect of ratification Where acts are done by one person on behalf of another, but without his knowledge or authority, he mayelect to ratify or to disown such acts. If he ratify them, the same effects will follow as if they had beenperformed

Agent’s duty in naming such person —In selecting such agent for his principal, an agent is bound to exercise the same amount of discretion as a man of ordinary prudence would exercise in his own case; and, if he does this, he is not responsible to the principal for the acts or negligence of the

Relation between principal and person duly appointed by agent to act in business of agency Where an agent, holding an express or implied authority to name another person to act for theprincipal in the business of the agency, has named another person accordingly, such person is not asub-agent, but an agent of the principal for

Agent’s responsibility for sub-agent appointed without authority Where an agent, without having authority to do so, has appointed a person to act as a sub-agent, the agent stands towards such person in the relation of a principal to an agent, and is responsible for his acts both to the principal and tothird persons; the principal

Representation of principal by sub-agent properly appointed Where a sub-agent is properly appointed, the principal is, so far as regards third persons, represented by the sub-agent, and is bound by and responsible for his acts, as if he were an agent originally appointed by the principal.Agent’s responsibility for sub-agent.—The agent is responsible to the principal

“Sub-agent” defined A “sub-agent” is a person employed by, and acting under the control of, the original agent in the business of the agency Practice area’s of B K Goyal & Co LLP Income Tax Return Filing | Income Tax Appeal | Income Tax Notice | GST Registration | GST Return Filing | FSSAI Registration

When agent cannot delegate An agent cannot lawfully employ another to perform acts which he has expressly or impliedly undertaken to perform personally, unless by the ordinary custom of trade a sub-agent may, or, from the nature of the agency, a sub-agent must, be employed. Practice area’s of B K Goyal & Co LLP Income

Agent’s authority in an emergency An agent has authority, in an emergency, to do all such acts for the purpose of protecting his principal from loss as would be done by a person of ordinary prudence, in his own case, under similar circumstances.Illustrations(a) An agent for sale may have goods repaired if it be necessary.(b)