The relationship of agency relies on personal confidence (delegatus non potest delegare), meaning an agent generally cannot delegate their work, subject to specific legal exceptions.
1. Sub-Agent vs. Substituted Agent
| Sub-Agent (Section 191) | Substituted Agent (Section 194) |
|---|---|
| A person employed by, and acting under the control of, the original agent. | A person named by the agent to act directly for the principal, under authorized power. |
| No direct privity of contract between principal and sub-agent. Agent is responsible for sub-agent. | Direct privity of contract between principal and substituted agent. Original agent is not responsible. |
2. Termination of Agency (Section 201)
An agency is terminated by:
- The principal revoking his authority, or the agent renouncing the business of the agency.
- The completion of the business of the agency.
- The principal or agent dying or becoming of unsound mind, or the principal being adjudicated an insolvent.
3. Irrevocable Agency: Section 202
Under Section 202, where the agent has himself an interest in the property which forms the subject-matter of the agency (agency coupled with interest), the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest. (e.g. principal authorizes agent to sell principal's land and pay himself from the proceeds to satisfy a debt).