DUTIES OF PRINCIPAL TO AGENT

• i. to pay commission or remuneration to the agent

  • The principal must pay the agent as they agreed.
  • But if the agent misbehaves or does something wrong in their job, they might not get paid. (section 173)
• ii. not to willfully prevent or hinder the agent from earning his commission


  • Once you hire an agent, give them a fair chance to do their job and earn their pay. Don't try to cheat them out of their commission by refusing their work or hiring someone else to do it instead.
• iii. to pay and compensate the agent for acts done in the exercise of his duty


  • If the agent has to spend money or loses money while doing what the principal asked, the principal has to pay them back. It's like saying, "If you lose money doing my work, I'll cover it (section 175)
• the time when the principal must indemnify (compensate) the agent

  a)the agent has incurred losses or liabilities in performance of his duties

  (case)

  kyall & evatt v lim kim keat

  an estate executor (principal) asked brokers (agents) to sell shares from a will. The brokers sold the shares, but then found out the will wasn't valid in England. To fulfill the sale, the brokers had to buy other shares, causing them a loss. The brokers sued the executor to get their money back. The court held that the agent were entitled to be indemnified for their loss
• the time when the principal must indemnify (compensate) the agent

  b) the agent causes injury to third party in the execution of his authority (section 176)

  c) the agent suffers injury during the course of his duties due to the principal's negligence (section 178)