Agency of ratification

A principal can choose to adopt or ratify transactions which were made without his authority. However, there are several requirements to be fulfilled.

First of all, the principle must be disclosed by the agent to the third. For example in the case of Keighley, the agent has purchased the wheat at a higher price in the agent’s own name. Therefore, it render the principal an undisclosed principal and has no right in ratifying the contract.

Secondly, the principal must be inexistent at the time o the agent act. In the case of Kelner v baxter, a promoter had entered into a contract on behalf of a company which is not yet to be formed. The court held that the promoter is liable to the third party.

Thirdly, the principal must have the contracted capacity at the time when the act was done. The principal must have to capacity to make a contract when the agent is making a contract. For example in the case of Boston Deep Sea Fishing Co, the principal was an enemy alien when the contract was made by his agent. Therefore, as an enemy, such capacity is not recognized by the law.

Lastly, an act which is void cannot be ratified. Is pretty much straight forward that something which is void does not has legal effect anymore. Basically, there is no need in to further ratify.

Actual Authority

Actual Authority may arise from three circumstances, impliedly, expressly and Agency of Necessity.

Express authority is pretty straight forward; it is an authority which is expressly conferred by an agreement or by words depending on the construction of words of appointment. However, it might get tricky when one trying to interpret an oral agreement. If any ambiguity were to occure, an agent must interpret in a manner which is reasonable.

Implied authority may arise from 3 circumstances and they are Incidental authority, by contrast and usual authority. Incidental authority simply means an agent has the implied authority to do everything necessary for the ordinarty incident to the express authority in the usual way. For example, an agent is instructed to sell a house was held to have an incidental authority to sign the agreement of sale. Case on point, Rosenbaum v belson. Secondly, an incidental authority can arise by contrast. For example in the case of Earner v Sharp, apparently an agent who was instructed to find a purchaser but was not told to sell the house by contrast does have an incidental authority to sign the contract. Lastly, a usual authority means an agent has implied actual authority to do whatever that is usual in his trade or profession, for the purpose of carrying out his authority or anything necessary or incidental to it. For example a managing director is impliedly to have all the authority as an agent to make contract on behalf of the company because it is the duty of a managing director to run the company. Case on point will be the case of Hely-Hutchison v Brayhead Ltd.

Lastly, Agency of Necessity may arise from an emergency. If it is necessary for the agent to contract with a third party in an emergency to protect or preserve the interest of the principal, then the agent with have an actual authority in making a contract. For example in the case of China Pacific SA, the captain has authorized a salvage operation in order to lighten the ship; the salvors unloaded some of the wheat and put it in storage. The salvors then sue for the storage. The court held that such emergency has created an agent of necessity and the captain will have the authority to make a contract. However, the necessity must be an actual and definite commercial necessity. There are basically four requirements to fulfill; firstly, it must be an emergency. Secondly, as a result of the emergency, it is practically impossible to obtain instruction. Thirdly, it must be bona fide in the agency’s interest not the agent’s personal interest and lastly, the agent must act reasonably.

Apparent Authority

Apparent authority is define by the Freeman as, apparent authority is a legal relationship between the principal and the third party created by a representation made by the agent to the third party intended to be and in fact acted on by the third party that the agent had authority. In a more simple explanation, an apparent authority can be define as a representation made by the agent to the third party claiming that the agent has the authority to act but actually, the agent does not have the actual authority. However, the agent managed to persuade the third party that there is a legal relationship between the principal and the third party.

An apparent authority can be termed as agency by estoppels, in other words, it is an equitable principles. As for most of the equitable estoppels, it involve representation, reliance and unfair as a result of alteration of terms or contracts. There are 3 basic requirements to be met in order to qualify as an agency by estoppels. Firstly, there must be a representation. A representation can either be in writing or by conduct, for example, an appointment of a person to a Managing Director can be seen as a form of representation by conduct. Secondly, there must be reliance, the person must had relied upon the representation and believe agent has such authority. Lastly, if the third party had relied on the representation and thus goes into the contract based of the detriment, it is then unjust for the principal to deny his liability

Law of Agency

What is an agent?

In or normal life, we are dealing with a lot of agent but most of the time, we are unaware about it. An agency can be created as simple as a bus driver and the passengers. The bus driver being the agent to the bus company and make a contract with the passenger. The legal definition for an agent is, an agent has the authority to make contract with a third party on behalf of another person or legally known as principal. After making the contract, the agent usually drops from the picture and the contract are normally left to the principal and the third party. If any breach occurred, it is left for the principal to deal with the third party. As mentioned above, an agent is just like the bus driver, and middle man. Payment is paid to the company not the bus driver and if anything were to happen, it is the company’s liability.

Remedy under Law of Insurance

Insurance are often viewed as a normal contract with involved a seller and a buyer in exchange of a service, a service which will compensate the buyer if anything were to happen to the insured object either to the insured’s health or item. If a breached of contract were to occurred, the buyer or seller can just simply rescind the contract.

However, the law of insurance is not as simple as it appears. There are actually three types of remedy available and that is to rescind the contract, avoidance for non-disclosure and the doctrine of Subrogation. Rescind of contract is very much common and it merely involve the termination of contract.

The law gets more complicated with the second and third remedy. Non disclosure is a very drastic remedy. If the insurers find out that the insured had failed to disclosure any relevant information which might effects the premium, then the insurers can disclaim their liability and leaves the insured without any protection which he thought he had contracted for. For example in the case of Wootcott v Sun Alliance, Wootcott had insured his house to Sun Alliance. Unfortunately, the house was damaged by the fire but the claim was rejected. The insurer has refused payment on the basis of non disclosure on the part of Wootcott in failing to disclose his past conviction for robbery and other offences. The court held that it was a valid disclaimer.

The third remedy available is the Doctrine of Subrogation. This doctrine has a couple of effects; Firstly, the insured cannot receive more than he is accountable for. Secondly, the insurer may sue any third party who is liable to the insured for the loss in action for tort of contract. The insurance company is entitled to do so for standing in the shoe of the company and sue the third party if he had negligently caused damage. A case on point will be the case of Lister v Romford. Lister, a lorry driver employed by Romford Ice Company negligently injured his father when reversing his lorry. As a result, the company’s insurer paid the damages to the father but then later on sued Lister in the name of Romford. The court held that Lister has breached the employment term for being driving recklessly which eventually cause an accident to his father. Therefore, the insurer can step in the shoes of the insured and benefit from the doctrine.

Maritime Admiralty Law

Article Link: http://www.articlesonline.org/article/law/maritime-admiralty-law-a-short-history--by-anna-henningsgaard/id/5884/

What is Maritime Admiralty Law?

This is a system of law which relates to the affairs of the sea. It covered the topic includes shipping, navigation, waters, commerce, seamen, wharves, piers and docks, insurance, maritime liens, canals, and recreation. Ship hijacking (piracy) also one of the aspect of admiralty.

Example taken from US legal definition:

A ship flying the American flag in the Persian Gulf would be subject to American admiralty law and a ship flying a French flag in American waters will be subject to French admiralty law.

The source of law is determined by the ship's flag. It applies to criminal law regulating to the ship's crew. It said that to apply the law of flag, the ship with the flying the flag must have contact with the nations of its flag.

Maritime Cause Law is referred to those cause that created from the maritime contracts such as between the charter parties, servicing and repairing the ship, navigating and supplying the ships, contracts about the maritime insurance with those owner of the ship.

Function of soft law

Continued with the previous post. This further explained more about the function of soft law.

Soft law instruments are highly favorable by the law makers. The soft nature has finally put itself in a better use. Thus, it is easier to conclude an agreement because the commitments to such law are less strict and limited, also, this encourage parties to consent to more detailed and precise provisions especially in the area of environmental law where developing nations are more reluctant to cooperate and often focus on economic progress. If such agreements are made, the chance of a multilateral agreement to legalized a soft law will be higher. Apart from that, the lack in formality of a treaty, soft law is easier to be amended or abolished. Therefore, it does encourage states to agree on an agreement, without the needs of democratic accountability and avoid the complex process to a treaty. It might not have immediate effect but as discussed above, such as implementation of treaty can really put such soft law in good use. It can also be seen as a stepping stone to address the more sensitive issues and molding it into a multilateral agreement.

Soft law instrument can be viewed as a redundant piece of legislation, without a proper legal personality or the legal effect. However, in practice, soft law is capable of producing good law for the long run and it has become a more favorable legal instrument. It also has the capability in developing customary international law at a faster rate in the form multilateral agreement.