Principle: An agent has implied authority to do all such things as are necessary or incidental to the express authority granted by the principal. Facts: P sends A as her agent to negotiate the purchase of a house for her. A pays a small earnest deposit to secure the deal, which P had not expressly authorised. The deposit is
AA breach of authority and not binding on P
BWithin A's implied authority because paying earnest is incidental to the act of securing a house purchase; P is bound
CBinding on P only if the deposit is below Rs 1,000
DBinding on A personally and not on P
Answer & Solution
Correct answer: B. Within A's implied authority because paying earnest is incidental to the act of securing a house purchase; P is bound
Section 188 Indian Contract Act: implied authority extends to everything necessary or incidental to the express authority. Paying earnest to secure a property is a normal incident of negotiating a house purchase.
Related questions
A man rows downstream at 12 km/h and upstream at 8 km/h. His speed in still water isThe compound ratio of 2:3, 4:5 and 5:6 isIf a + b = 10 and a - b = 4, then a × b equalsParadox: 'The cheaper the energy source, the lower the country's per-capita consumption.'
All policies that promote economic growth promote jobs. Some job-promoting policies are en'Most successful business leaders read at least 30 books a year. Therefore, anyone who reaArticle 368 of the Constitution provides the procedure forArticle 51A (Fundamental Duties) was added by the