Professional Documents
Culture Documents
Agency - Intro
Agency - Intro
Agency
• Basis: Representation
– The acts of the agent on behalf of the principal within
the scope of his authority produce the same legal and
binding effects as if the principal personally did them
Basis is
Representation
Purpose: To extend the
personality of the principal
through the facility of the agent
Distinguishing Features:
1. Representative
character
2. Derivative authority
Elements of
Agency
1. Consent – express or implied
2. Object – the execution of a
juridical act in relation to third
persons
3. The agent acts as
representative and not for
himself
4. The agent acts within the
scope of his authority
Characteristics
• Consensual
– Perfected by mere consent
• Nominate
– Has its own name
• Principal
– Does not depend on another contract
for its validity
• Preparatory
– Entered into as a means to an end
Parties
1. Principal
– The person represented (natural or juridical person)
from whom agent derives his authority
– He must be capacitated
2. Agent
– The person acting for another in a representative
capacity
– His actions are binding on the principal
– “attorney-in-fact,” “representative,” “proxy”
Fiduciary Relationship
• Agency is a fiduciary relationship between the
principal and the agent
• Fiduciary
– Based on trust and confidence
– Agent is required to observe utmost good faith and
loyalty towards his principal
– Agent must look after the principal’s interest as if they
were his own
Acts An Agent Cannot Do
1. Personal Acts
– If personal performance is required by law or agreement
– Ex: right to vote, making a will, statement under oath
2. Character
– Gratuitous – agent receives no compensation
– Onerous – with compensation
Classifications of Agency
3. Extent of Business Covered
– General – comprises all of principal’s businesses
– Special – comprises one or more specific transactions
4. Authority Conferred
– Couched in general terms – comprises only acts of
administration
– Couched in specific terms – authorizes only the
performance of specific acts
Classifications of Agency
5. Nature and Effects
– Ostensible/Representative – agent acts in name and
representation of the principal
– Simple/Commission – agent acts in his own name but
for the account of the principal
Form of Agency Contracts
• General Rule
– There are no formal requirements
– Agent’s authority may be oral or written, or in public or
private documents
• Exception
– When the law requires a specific form
– Example: sale of real property by an agent
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• Power of Attorney
– An instrument in writing by which one person, as
principal, appoints another as his agent and confers
upon him the authority to perform certain specified
acts on his behalf.
– The evidence of the agent’s authority
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• Revocation
– An agency is revoked in the same manner as it was
given
Agency by Estoppel
• There is really no agency at all, but the alleged
agent seemed to have apparent or ostensible,
although no real authority to represent another
• Kinds:
– Estoppel of Agent
– Estoppel of Principal
– Estoppel of Third Persons
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• Arbitration
– Settlement of a dispute by a third party (arbitrator),
other than by a court
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• Exception
– If the contract involves something belonging to the
principal
• The principal can file a case for damages against the agent
Next Meeting
• Obligations of the Agent
• Obligations of the Principal
• Modes of Extinguishment of Agency