An agent is a person who works as a representative of another person or who works on behalf of principal. During course of his work, he performs several works and the works performed by him, ultimately goes under the liability of his principal. The right and duties of the principal and agent seem corresponding to each other. Being an agent, he has some rights and some duties. The rights and duties of agent are given below separately.

Rights of Agent

 The following are the rights of an agent:-

  • Right to retain money:

The agent has right to retain necessary costs received on the account of the principal in the course of business of agency.

  • Right to receive remuneration:

Where the contract on the remuneration or commission, the agent has right to sum remuneration or commission and it must be supplied to him. He has right to receive salary at the time of completion of his work. In this respect Section 219 of the Indian Contract Act, 1872 has made the provisions.

  • Right to lien:

Except otherwise agreed, an agent has a right to retain goods, papers and other property of the principal received by him, until the amount due to himself for compensation and services in respect of, has been paid to him. The agent can only retain the goods he has no power to sell.

  • Right to Compensation:

An agent has right to compensation to him by the principal's negligence. According to the Section 62(3) of the Nepal Contract Act, 2056, unless otherwise provided that in contract, the agent is entitled to reasonable compensation for the loss or principal removes the agent without any reasons before the specific period prescribed or before the completion of work assigned to him or without a prior notice stating reason if no period or work has been prescribed for.

  • Right to stoppage of goods in transit:

An agent has right, as an unpaid seller, to stop the goods in transit to the principal on the following conditions;

  • He has bought goods either with his own money or by incurring a personal liability for the price.
  • The principal has becomes insolvent.

Duties of Agent

 The agent performs work on behalf of principal; therefore an agent has the following duties towards the principal:

1. To conduct the business of agency according to instructions of the principal: It is the duty of every agent as to act and perform the agency work according to the directions given by the principal.  When the agent acts otherwise and there occurs any loss, he must account for such work himself.

2. To follows customs of trade in the absence of instructions: It is duty of an agent to perform the work in accordance with the law, practices and custom, where expressly no instruction is made by the principal. If the agent does not do so, he is liable for the loss sustained by the principal.

3. To render proper accounts to the principal: The agent has to maintain the account properly. And the agent has to render proper account to the principal or provide detail of accounts and records on principals' demand.

4. To communicate with the principal, in case of difficulty: To provide all reasonable communication with his principal in seeking to obtain his instruction before taking any steps in facing the difficulty or emergence.

5. Not to deal on his own account: According to section 215 and 216 of the Indian contract Act, 1872 the agent must not deal on his own account in the business of agency without consent of the materials circumstances which have come to his knowledge.

6. To pay all sums received for principal: The agent must pay to the principal all sums received on his behalf.

7. Not to delegate his authority and responsibility: An agent can not delegate his authority or employ another to perform acts which he has expressly or impliedly undertake to perform personally. Ordinarily an agent can not further delegate the authority which has been delegated to him by his principal.

8. Not to make secret profit: An agent stands in fiduciary relation to his principal and therefore he must not make any profit out of his agency. He must pay to his principal all moneys received by him on principal account.

9. Not to disclose confidence: To operate the business activities, it is necessary the confidence between the agent and principal. Therefore, not to disclose the confidential matters others.

10. Not to set up adverse title: The agent must not set-up his own title or the title of third party to the goods received by him from the principal.

11. Act in good faith and in the interest of the principal: An agent is only a doer of the principal; he has to work for the benefit and interest of the principal.