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For the acts of substituted agent exceeding his authority , who will be liable to 3rd party

Star Ca

CA Inter

★ 3K+

26-Feb-21 20:53

334

Answers (2)

Note that according to section 195 of the Contract Act, 1872, in selecting an agent (substituted) for his principal, an agent is bound to exercise the same amount of discretion as a man of ordinary prudence would exercise in his own case; and, if he does this, he is not responsible to the principal for the acts or negligence of the agent so selected. So, check out topic 'PRINCIPALâ??S LIABILITY TO THIRD PARTIES'. Same shall also be applicable in case of substituted agent.