There are different classsifications of agents in an agency relationship. They are:
1. Classification according to the extent of the Principal’s right
2. Classification according to the nature of liability imposed on the agent.
3. Classification according to the terms of the agent’s function.
Classification according to the Extent of the Principal’s Right
Under this classification, we have universal, general and special agents.
Universal agents are those agents that have unlimited power to act generally for the principal.
A general agent is one that is given the power to act for his principal in a particulart field. For example, a lawyer is a general egent for his principal in legal matters. Also, directors of a company are agents of the company. So also are managers of a particular business .
A special agent is one that has been empowered to act in specific instances. For example, if a principal instructs a lawyer to purchase a land for him, in that instance, the lawyer is a specific agent to the principal.
Classification According to the Nature of Liability Imposed on the Agent
Under this classification we have:
1. Agents that are not personally liable: This covers the general type of agents we see around. Generally, an agent is not personally liable for actions he takes. It is the principal that is liable. However, he must act in the principal’s best interest since it is a fiduciary relationship.
2. Del Credere Agent: A del credere agent is one that guarantees to a principal that the third party would perform his obligation in a contract. Due to the high risk involved, he is paid a commission for his role. This commission of called del credere.
Thus, if the third party fails in his obligations, the del creder agent would indemnify the principal.
3. Confirming House: This agency comes to play in an export business. Liability in this type of agency is quite similar to liability in del credere agency. In this type of agency, the confirming house pledges to be liable to an exporter of goods if the international buyer fails in his own part of the bargain.
In the case of Sobell Industries vs Cory Bros Co , Turkish buyers placed an order with the plaintiffs for a large amount of radio sets and the defendat served as the confirming house. Susbequently, the buyers didn’t take full delivery of the goods. It was held that since the defendant acted as a confirming house, they were liable for damages which occurred as a result of non-acceptance.
Classification According to Functions Performed by the Agent
Under this classification, we have the following:
1. Broker: This is an agent that is engaged to negotiate for the sale or purchase of a property for a commission known as brokerage. However, a broker doesn’t have possession of the goods.
2. Factor: This is an agent that has been engaged to sell or deal with goods that have been consigned to him by his principal. He is usually entrusted with the possession of the goods.
3. Estate Agent: These are agents used by real estate owners or land speculators in order to buy and sell landed property. They do this in exchange for an estate commission.
4. Bankers: Banks serve as the agent of account holders in a limited sense. In the instance of a cheque, the account holder is the principal, the bank is the agent while the payee is the third party.
5. Auctioneers: An auctioneer is also an agent of the owner of the goods. An auctioneer is the person that conducts the auction on behalf of the owner. He may or may not have possession of the goods being sold.
Author: Olanrewaju Olamide
Olamide is an avid reader who believes that no knowledge is wasted. If he is not surfing the internet, he would be doing something else to get more information, whatever that is.