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Agency Agreements Notes

LPC Law Notes > Commercial and IP Notes

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A more recent version of these Agency Agreements notes – written by Cambridge And Oxilp And College Of Law students – is available here.

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Elective: Commercial and IP

Commercial Law Agency Agreements


Agent is an INTERMEDIARY between the supplier [the "principal"] and the ultimate consumer.

Agent REPRESENTS the supplier - he can negotiate and [sometimes] conclude contracts for supplier. Agent acts on behalf of the supplier.

Agent is NOT PARTY to the contract [it is the supplier who contracts with customer]. Th agent creates a legal relationship between the supplier and end consumer. Supplier bears the financial and legal risk!

Agent receives a fee / commission for his services for each contract Types of Agency Agreements:

1. Sales: Agent has authority to conclude the contract.

2. Marketing: Agent only has authority to negotiate on behalf of the supplier.

3. Exclusive: The Agent is assigned a territory and has exclusive authority to negotiate / conclude contracts over this area. The principal cannot interfere.

4. Non-Exclusive: Agent, principal and other agents can conclude contracts in the territory. Least advantageous for the Agent.

5. Sole: Both agent and principal can conclude contracts within the territory. Sources of rights / obligations

Agent has a fiduciary role

Common law rights for Agent [e.g. indemnity against expenses incurred on principal's behalf]

Commercial Agents Regulation 1993

Contractual rights [from Agency Agreement] -the agreement defines the authority of the agent and specifies the rights & duties for both supplier and Agent. Agent's authority General rule: If agent acts within authority [actual or apparent] -the contract is binding between the principal and 3rd party.

a) Actual authority:
? Express; or
? Implied: "usual / customary authority" -agent may impliedly have the authority which an agent in THAT position usually has or what is customary for agents in that particular trade have b) Apparent / ostensible authority:
? Based on Estoppel [fairness to 3rd party to impose the authority on the agent]
? 3 requirements =
a) Representation that Agent had authority b) From someone with authority to make that representation; and c) 3rd party must rely on that representation


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