Each case revolves around its own facts and the first legal advice makes sense. The agency can be a double-edged sword; When properly worded, it can provide a significant benefit, but the fact that the ability to act can be implicit in situations and can unintentionally bind a principal makes it potentially very risky, conversely. The English High Court ruled that a client could legally terminate an agency contract with immediate effect on the basis of two telephone calls between the agent and the client, which, in the words of Judge Simon Brown QC, constituted « personal abuse of the worst kind and gross insubordination ». The terms « agency » or « agent » are freely used in business, but sometimes wrongly. Problems often arise when the client never intended to set up an agency, but has inadvertently appeared in the law and the client is bound by unwanted responsibilities; or if the client intended to set up an agency but proves to be unreliable, unreliable, intentionally misleading or does not deliver or promise too many things that can be achieved. The following note provides a brief introduction to the principle of agency under English case law (known as the Common Law Agency). It affects, but does not address, entirely commercial representation, to which another law applies. 6. If the agreement falls under the rules of the commercial agency, it may be established that the principal is acting in good faith towards the agent, but there is no general requirement in the Common Law Agency. There are three types of agencies: disclosed agencies, anonymous agencies, and undisclosed agencies. The disclosed agency is the simplest type of agency where the third party knows that the agent they are dealing with is acting on behalf of the principal.
Anonymous agency occurs when the third party knows that the person they are dealing with is an agent, but the identity of the customer is unknown. As a general rule, the identity of a contracting party is not considered an essential issue under English law. An undisclosed agency occurs when the « agent » appears to be acting on his or her own behalf, when in fact he or she is acting on behalf of an agent. This is an unusual type of agency and is discussed later, because usually once a contract has been concluded by an agent, the agent « disappears »; The obligations arise only from the contract concluded between the customer and third parties. One of the most common forms of agency that our litigants deal with is commercial representation. Sales reps are often used by companies looking to expand into new markets or locations where the agent may be explicitly allowed to close sales with new customers. This note refers to the agency in the broad sense, and there is a separate note for the commercial agency. For commercial agents regulated by regulation, if the agent is terminated, he may of course be entitled to compensation, and the dispute may extend to the value of fair compensation. Minimum notice is required. If the agency occurs unintentionally, the courts will consider the nature of the agency in terms of interpretation, and will deal primarily with whether or not another person has been given the power to act, and may decide whether or not it is reasonable to maintain an agency under the law; it is not always clear and can lead to surprising results.
In Watteau v. Fenwick,[3] Justice Lord Coleridge agreed with Justice Wills` view on Queen`s Bench that a third party could hold personally liable a principal he knew when selling cigars to an agent acting outside his jurisdiction. Judge Wills noted that « the principal is responsible for all actions of the agent that fall under the authority normally entrusted to an agent of that type, regardless of the restrictions imposed between the principal and the agent imposed on that authority. » This decision is strongly criticised and questioned[4], although it is not completely annulled in the United Kingdom. It is sometimes called « habitual authority » (but not in the sense used by Lord Denning MR in Hely-Hutchinson, where it is synonymous with « implicit real authority »). It has been explained as a form of apparent authority or « inherent agency power. » The Common Law Agency regulates the provision of services or agreements, such as between employers and employees, as well as property. The Common Law Agency applies much further and can act as a collective term and apply to goods and services as well as relationships between employers and employees. it may not be clear which law is applicable, and early legal advice makes sense. If an agency and litigation have already arisen, early legal advice on what the law says can help you plan an extraction plan while trying to limit the loss. If it is not clear if the officer is authorized to do what he did and if it is a violation, legal advice can help. If you`re wondering if you`ll be held accountable by an agent`s actions, early legal advice can help you and help you distance yourself.
An agency contract can be automatically terminated by law when the task is completed, if the contract has been thwarted, in the event of death, insolvency or incompetence. If an agent makes a mistake or engages in an illegal activity while representing the principal, it can technically be assumed that the principal committed the act, since the agent essentially acted as principal. A principal is also bound by all contracts that an agent enters into on his behalf and may be held liable if he injures a person or damages property. The agency contract must therefore be made in writing with clear terms and conditions. The agreement must explicitly limit the Customer`s liability if the Agent does something that has not been authorized. English « common law » refers to the law that has evolved in the course of historical English court proceedings. The Commercial Agents Regulation 1993 (Council Directive) is important for agents as it generally allows for higher compensation in the event of termination. it is one of the obligations imposed on the contractor of a commercial agent.
However, they certainly increase the complexity of the agency`s law. Our commercial litigation lawyers regularly advise on a complex area of law that often occurs in all kinds of situations, often unintentionally. If you are in a commercial dispute regarding the agency or more generally, please contact 02076324300 for an initial non-binding consultation. In case of negligence in the performance of its tasks, a representative is directly liable either to the customer or to a third party. If the agent deceives or acts fraudulently, the agents may be held civilly and criminally liable. .