BREACH OF AGENCY AGREEMENT
Prince Joel ESQ | November 5, 2016 | Land Verification | No Comments
An agency agreement is the creation of a contract entered into by a mutual consent between a principal and an agent. A principal is a person that grants authority to an agent to act on behalf of and under the control and instructions of the principal. Therefore, the law governs and regulates the legal relationship in which an agent dealing with a third party for his/her principal.

Both parties, that is; the Agent and the Principal owe certain duties towards each other. The extent of these parties duty is usually determined by the terms of the agreement between the parties and extent of the authority and obligation conferred on the agent by the principal.

An agent’s primary duties are:

To act on behalf of and be subject to the control of the principal;
To act within the scope of authority or power delegated by the principal;
To discharge his/her duties with appropriate care and diligence; and
To avoid conflict between his/her personal interests
An agent cannot acquire any material benefit from a third party in connection with transactions conducted or through the use of his/her positions as an agent. He must act with the care, competence, and diligence normally exercised by agents in similar circumstances. He must also take action only within the scope of his/her actual authority and comply with all lawful instructions received from the principal and persons designated by the principal. An agent must act reasonably and refrain from secret profit or conduct that is likely to damage the principal’s enterprise

An agent is liable to a principal when he/she acts without actual authority, and liable to indemnify a principal for loss or damage resulting from his/her act.

A principal on the other hand owes certain contractual duties to his/her agent.

A principal must compensate the agent as agreed and also indemnify and protect the agent against claims, liabilities, and expenses incurred in discharging the duties assigned by the principal. A principal owes his/her agent a duty to act in good faith and fair dealing.

However, a principal can be relieved of contractual obligations by an agent’s prior breach of contract.

An agent can be relieved from his duty by the principal through termination because the agent is in breach of their agency agreement

If the agent fails to perform any of the duties instructed by the principal and the principal suffers damages as a result, the principal may be able to win a case against the agent for breach of duty.

In addition, it should be noted that anyone whom the agent injures while dealing on the principal’s behalf may choose to sue the principal for damages based on the third party’s injuries. Some courts will hold the principal liable even if there was no express contractual agency relationship, as long as the injured person reasonably believed that the agent was acting on behalf of the principal when the injury occurred.
Read full article here : http://www.ibejulekkilawyer.com/breach-of-agency-agreement/