Q-8 What do you meant by sub-agent also explains the effects of appointment of sub-agent.
A sub-agent is a person who is employed by the original agent and who acts under the control of the original agent in the business of agency. Thus, a sub-agent is the agent of the original agent. As between the original agent and the sub-agent, the relationship is that of the principal and agent.
EFFECT OF APPOINTMENT OF SUB-AGENT [SECTION 192 AND 195]
The effects of appointment of a sub-agent may be discussed under the following two heads.
(i) In case of proper appointment.
(ii) In case of improper appointment.
|Basis of Comparison||Where a subagent is properly appointed [Section 192]||Where a sub-agent is not properly appointed [Section 193]|
|1.||Is principal bound||The principal bound by the acts of sub-agent.||The principal is not bound by the acts of sub-agent.|
|2.||Is principal responsible||The principal is responsible for the acts of sub-agent.||The principal is not responsible for the acts of sub-agents.|
|3.||Is original agent responsible||The original agent is responsible to the principal for the acts of sub-agent||The original agent is responsible for the acts of sub-agent both to the principal and to the third persons.|
|4.||Is sub-agent responsible||The sub-agent is responsible for his acts to the original agent but not to the principal exception cases of fraud or willful wrong.||The sub-agent is responsible for his acts to the original agent but not to the principal even in cases of fraud or wilful wrong.|
Note: The original principal may ratify the acts done by a properly appointed syb-agent in the name of original principal,
MEANING OF SUBSTITUTED AGENT (SECTION 191]
A substitute, agent is a person who is named by the agent holding an express or implied authority to name another person, to act for the principal in the business of the agency. Such person is an agent of the principal for such part of the business of the agency as is entrusted to him.
A directs B, his solicitor, to sell his estate by auction, and to employ an auctioneer for this purpose B names C an auctioneer, to conduct the sale, C is not a sub-agent but As agent for the conduct of the sale.
AGENTS DUTY IN NAMING SUCH PERSON [SECTION 19S]
In selecting such agent for his principal, an agent is bound to exercise the same amount of discretion as a man of ordinary prudence would exercise in his own case, and if he does this, he is not responsible to the principal for the acts or negligence of the agent so selected,
A consigns goods to B, a merchant, for sale, B in due course employs an auctioneer in good credit to sell the goods of A, and allow the auctioneer to receives the proceeds of sale. The auctioneer after wards becomes insolvent without .having accounted for the proceed. B is responsible to A for the proceeds.
Basis of Comparison
|1.||Work||He works under the control of original agent.||He works under the control of principal.|
|2.||Privity||There is no privity of contract between a sub-agent and principal and hence both cannot sue each other except that in case of fraud or willful wrong committed by a properly appointed sub-agent, the principal can sue sub- agent.||There is a privity of contract between a substitute agent and principal hence both can sue each other.|
|3.||Original agent’s responsibility||The original agent is responsible for the acts or negligence of the sub-agent.||The original agent is not responsible for the acts or negligence of the substitute agent if in selecting such agent the has exercised the same amount of diligence as a man of ordinary prudence would exercise in his own case.|