business law
The issue of this case is whether Freeze Bhd. (FB) has acted as an agent of necessity in the situation and qualified to claim for warehouse storage charges from Nice to Eat Restaurant (NER). Section 142 Contract Act 1950 states, “An agent has authority, in an emergency, to do all such acts for the purpose of protecting his principal from loss as would be done by a person of ordinary prudence, in his own case, under similar circumtances.” According to Section 142, an agency by necessity may arise under certain circumtances a person may become an agent of another without having appointed as such. Such an agency relationship is definitely recognised by the court. Yet, there are three conditions to be fulfilled to create an agency of necessity :
a) It must be a situation that impossible for the agent to get the principal’s instructions in carrying out such action.
b) The agent’s action is necessary, to protect the principal from loss of the respective goods committed to his charges.
c) The agent of necessary has acted in a good faith. In Great Northern Railway Co. V Swaffield, the defendant entrusted the plaintiff, railway company to carry his horse to its destination. However, there was no one to receive the horse at the railway station and the station master could not get any instruction from the defendant at the time, the plaintiff sent the horse to stable as alternative and claimed the charges for the stable. The court held that the defendant must pay for the charges for stable since plaintiff have had no choice but to arrange proper care for the horse on behalf the defendant. The plaintiff was an agent of necessity by fulfilling the three conditions stated above. In the case of Freeze Bhd. (FB) and Nice to Eat Restaurant (NER), FB was entrusted by NER to deliver the frozen seafood to its destination but NER has been closed for one week. Thus, no one receive the container of frozen seafood and FB’s driver could not get any instruction of any NER’s
a) It must be a situation that impossible for the agent to get the principal’s instructions in carrying out such action.
b) The agent’s action is necessary, to protect the principal from loss of the respective goods committed to his charges.
c) The agent of necessary has acted in a good faith. In Great Northern Railway Co. V Swaffield, the defendant entrusted the plaintiff, railway company to carry his horse to its destination. However, there was no one to receive the horse at the railway station and the station master could not get any instruction from the defendant at the time, the plaintiff sent the horse to stable as alternative and claimed the charges for the stable. The court held that the defendant must pay for the charges for stable since plaintiff have had no choice but to arrange proper care for the horse on behalf the defendant. The plaintiff was an agent of necessity by fulfilling the three conditions stated above. In the case of Freeze Bhd. (FB) and Nice to Eat Restaurant (NER), FB was entrusted by NER to deliver the frozen seafood to its destination but NER has been closed for one week. Thus, no one receive the container of frozen seafood and FB’s driver could not get any instruction of any NER’s