2. “Can an agent delegate his powers?” In light of this statement bring out the difference between Sub-agent and Substituted agent. A has lost his share certificate of DCM Ltd. He applies to the company for a duplicate. What will the company ask him to furnish? Does it give rise to a contract and who are the parties? Why is it asked? Define it giving examples and explain its features.
ANSWER : Section 191 gives the definition of sub-agent in these words: A sub-agent is a person employed by and acting under the control of the original agent in the business of the agendy: So sub-agent is the agent of the original agent. As between themselves, the relation of sub-agent and original agent is that of agent and principal.
But to this general rule there are certain exceptions, where the agent is permitted to delegate his authority. He may appoint sub-agents. In the following cases:
Where the principal has expressly allowed his agent to appoint sub-agent. His consent may. also be implied from the circumstances.
Where the nature of work demands that a sub-agent should be appointed.
Where there is a custom of trade to that effect.
Acts which are of routine nature and can be done by the agent or delegated by him.
Where in the course of agent’s appointment, unforeseen emergencies arise which render A necessary to delegate his authority.
Where the principal knows that the agent intends to appoint a sub-agent.
Consequences of Appointing sub-agent. The legal relation between the principal and the sub -agent depends upon whether the appointment of the sub-agent is proper or improper.
Differences between a Sub-Agent and a Substituted Agent
1. Control: A sub-agent is the agent of the original agent as he works under the control of the agent whereas, a substituted agent is the agent of the principal because he works under the control of the principal.
2. Responsibility: A sub-agent is responsible for all the acts to original agent and for the acts of fraud or willful wrong to the principal. On the other hand, a substituted agent is responsible to the principal alone.
Differences between a Sub-Agent and a Substituted Agent
The following are some of the differences between a Sub-Agent and a Substituted agent.
Sub-Agent vs Substituted Agent
Sub-Agent vs Substituted Agent
1. Control: A sub-agent is the agent of the original agent as he works under the control of the agent whereas, a substituted agent is the agent of the principal because he works under the control of the principal.
2. Responsibility: A sub-agent is responsible for all the acts to original agent and for the acts of fraud or willful wrong to the principal. On the other hand, a substituted agent is responsible to the principal alone.
3. Contract: There is no direct contract between the sub-agent and the principal whereas there is direct contract between the substituted agent and the principal.
4. Appointment: A an agent appoints sub-agent only when he finds it necessary as per the custom of trade or the nature of agency. Whereas, a substituted agent is appointed by the agent when he has express or implied authority to do so from the principal.
5. Liability: Sub-agent is liable to the agent. However, substituted agent is liable to the principal.
6. Remuneration to agents: The agent pays remuneration or commission to a sub-agent. But in case of substituted agent, the principal makes such payments.
7. Responsibility towards third party: A principal is not responsible to the third parties for the acts committed by the sub-agent provided he has not been appointed by the consent of the principal. The principal is bound to all the acts of a substituted agent in the same way and extent as he is liable to the acts of his agent.
Capital is the money, which a company has raised by issue of its shares. It uses this money to meet its requirement by way of acquiring business premises and stock-in-trade etc. In relation to a company limited by shares, the word ‘capital’ means the share capital i.e., the capital in terms of rupees divided into specified number of shares of a fixed amount each. Sub-section 84 of section 2 of Companies Act, 2013 defines a share as “share means a share in the share capital of a company
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