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10 Legal Relations between Principal and Third Party

From: Agency: Law and Principles (4th Edition)

Roderick Munday

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 16 April 2024

Agent's rights against principal — Principal’s liabilities — Legal relations between principal and third party

This chapter emphasizes the primary purpose of agency, which is to bring principal and third party into direct contractual relations. It considers disclosed agency, citing situations in which the third party is aware of the existence of a principal, whether that principal is identified or not. It also deals with an anomalous situation, where the agent acts for a principal, whose very existence is concealed from the third party. The chapter explores two exceptions to the principle, nemo dat quod non habet: the doctrine of apparent ownership, and provisions of the Factors Act 1889 that permit mercantile agents to make unauthorized dispositions of their principal’s property to third parties. It examines the disclosed principal’s right to sue and be sued on transactions effected on his behalf that is at the very root of agency.

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