An agent has no right or obligation on a contract unless he/she enters into it on behalf of his/her principal. State and explain FIVE exceptions to this statement. (10 marks)

  • Where the agent agrees to accept personal liability: The agent may personally assume liability under the contract.
  • When the agent is not appointed by deed and signs the deed: The agent becomes personally liable if they sign a deed without clear indication they are acting as an agent.
  • Where the agent signs a bill of exchange in his own name: If the agent signs without indicating their agency status, they may be personally liable.
  • Where trade custom makes the agent personally liable: In some trades, agents are customarily held liable regardless of the principal.
  • Where the supposed agent is actually the principal: If the agent is the principal but purports to contract as an agent, they are personally liable.
  • Where an agent acts for an undisclosed principal: If the agent does not disclose that they are acting for a principal, they may be personally liable.

[Any 5 points at 2 marks each for a total of 10 marks]