Page 58 - 01. Indian Contract Act, 1872

Relationship between principal, agent and sub - agent
 Agent and Sub-Agent have the relation like that of agent and principal.
 Sub- agent is not directly responsible to the principal.
 Agent is responsible for the acts of sub- agent to the principal.
 Principal is responsible to third party for acts of both agent and sub -Agent.

Substituted Agent.
As per Sec. 194,
Where the principal appoints an agent, and if that agent identifies another person to
carry out the acts ordered by the principal, then the second person is not to be treated
as a sub- agent but only as an agent of the original principal.

Mercantile Agent
As per Sec. 2 (9) of the Sales of Goods Act, 1930 "Mercantile Agent is en agent
having in the ordinary course of business as such an authority either -
(i) to sell goods, or
(ii) consign goods for the purpose of sale, or
(iii) to buy goods ,or
(iv) to raise money on the security of goods.

It includes:
(1) Factors
(2) Brokers
(3) Del creder agent
(4) Auctioneers
(5) Partners
(6) Bankers

1. Factors
 Employed to sell goods placed in his possession.
 Contract to buy goods for his principal.
 Can sell and receive payment for the goods.
 Has an insurable interest in the goods.
 Have general lien in respect of any claim arising out of agency.

2. Brokers
 Contracts with other for the sale and purchase of goods and securities.
 Goods and securities are not in his possession.
 Gets commission in return called brokerage.
 Acts in principal's name.
 Has no lien over the goods.

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