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10 Legal Relations Between Principal and Third Party

From: Agency: Law and Principles (3rd Edition)

Roderick Munday

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2022. All Rights Reserved.date: 19 August 2022

Creation of agency — Nature of agency — Principal’s liabilities — Termination of agency — Legal relations between principal and third party — Legal relations between agent and third party

This chapter considers how and when direct contractual relations are created. The primary purpose of agency is to bring principals and third parties into such relations. In the first section, disclosed agency is considered—that is, situations in which the third party is aware of the existence of a principal, whether that principal is identified or not. The second section deals with the more anomalous situation, where the agent acts for a principal whose very existence is concealed from the third party. Finally, the third section explores two exceptions to the principle, nemo dat quod non habet and the provisions of the Factors Act 1889, which permit ‘mercantile agents’ under the Act to make unauthorized dispositions of their principal’s property to third parties.

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