3.

Duty to show proper skill and care (section 212)

If an agent does not show proper skill and care in the matter of whatsoever he is
an agent for then it is the duty of the agent to compensate the buyer of the loss.

In Keppel vs. Wheeler, the principal instructed the agent to find a buyer for his
estate. The agent communicated an offer of a prospective purchaser who was
willing to buy the estate for $6,150. Before the contract of sale the agent was
communicated with an another offer of $6950 for the same property but he did
not communicated the offer to the principal. It was held that agent did not
showed proper skill and care in the matter and therefore he is liable to pay for the
loss suffered to principal.

4. Duty to render proper accounts (213)

Another duty of the agent is, to render proper accounts to his principal on
demand. This means that he should maintain proper accounts of the sums
belonging to the principal who are in his hands, he should not misutilize them and
on demand from the principal, he should render proper and true accounts to him.

5. Duty to communicate with principal (214)

It is duty of the principal to use all reason

6. Duty not to deal on his own account(215 &216) (pg.

147)

An agent is under the duty to not to deal on his own account in the business of
agency, unless the principal consents thereto. If in any transaction an agent deals
on his own account without the principal’s prior consent, the principal has
following 2 rights:

1. To repudiate(cancel) the transaction by showing either-

i. That any material fact has been dishonestly concealed from him by the
agent; OR
ii. The dealing of the agent have been disadvantageous to him.
2. To claim from the agent any benefit which may have resulted to him from
the transaction.

Duty to pay sum received(sec. 217&sec. 218)

Rights of Agents and Duties of

Principal(pg.147)
1. Right to remuneration

According to above stated provision, an agent’s remuneration does not become

due to him until the completion of the act assigned to him. This rule is subject to
any special contract between the principal and the agent. If the parties have
agreed that the agent will be entitled to commission when he finds a purchaser,
who is ready and willing to purchase the property, the agent becomes entitled to
the commission on doing that.

In Saraswati Devi vs. Moti Lal, Moti Lal the plaintiff was an estate agent. Saraswati
devi and her husband engaged the agent to find the buyer for their property.
Estate agent found a buyer who was ready to buy the property and also paid
advance. Subsequently, the defendant refused to sell the property to customer.
The plaintiff brought an action against the defendants to recover the amount of
his commission. Court in its orders said that remuneration is payable to plaintiff
when he finds the purchaser who was ready, willing and able to purchase the
property and since he had done that, he was entitled to his commission.

2. No remuneration for the business misconducted (section 220)

An agent who is guilty of misconduct in the business of agency, is not entitled to

any remuneration in respect of that part of the business which he has
misconducted.

A employs B to recover Rs. 1000 from C. Through B’s misconduct money is not
recovered. B is entitled to no remuneration for his services and must make good
the loss.

3. Right of lien on principal’s property (section 221)

According to section 221, in the absence of any contract to the contrary, an agent
is entitled to retain goods, papers and other property, whether movable or
immovable of the principal received by him, until the amount due to him as
commission for his services has been paid or accounted to him.