Rights and Obligations
The terms of appointment should specify the agent’s authority, remuneration, rights and duties. The duties and obligations of the agent are implied by the general law in the absence of contractual provision for them.
EU Commercial Agents
The EU Commercial Agents Regulations apply to certain types of agency relationships, and where they apply, they are for the most part, mandatory.
An agent will usually be obliged to follow his principal’s lawful instructions, by the terms of his contract of appointment. The agent must not exceed the terms of his appointment and the scope of the authority granted by it.
Duty of Care
Where the agent is appointed under a contract, the obligation to exercise due care and skill may be specified or implied. The duty may be expressed in more onerous and unconditional terms.
If the agent is engaged in a particular profession, he is required to demonstrate the degree of skill and care of a reasonably competent practitioner.
Where delegation is permitted, the agent may appoint or employ a subagent. The agent’s right to delegate, if any, will affect the extent to which the agent retains duties to the principal in respect of the acts or omissions of the sub-agent.
The agent as a fiduciary, owes duties of loyalty and fidelity to the principal. As fiduciary duties are based on equitable principles, flexible equitable remedies may be available.
Duty to Account
The agent must account to the principal. He must keep an account of monies paid and received. He must keep the principal’s money, and assets separate from his own.
Responsibility for Wrongdoing
An agent who commits a civil wrong in the course of his agency is liable personally, to persons who thereby suffer damage, even if he acts under the express authority of his principal or if the act is later ratified by the principal. He will commonly be entitled to an indemnity from his principal.
Responsibility for Wrongdoing II
Liability may arise under the principles of vicarious liability and in some cases under general principles of agency. Even where the act is outside of the scope of his authority, the principal may be vicariously liable for acts in the course of the agency or within the ostensible scope of the agent’s authority.
Admission and Notice
Where an agent is authorised to make admissions, the principal is bound by them. Where he makes an admission without express or implied authority or in excess of authority, the principal is not bound.