Introducing the “In Favour Of” filter in Case Laws.
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Introducing the “In Favour Of” filter in Case Laws.
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of <h1>Principal Bound by Unauthorized Agent Actions if Third Parties Misled by Principal's Conduct.</h1> When an agent acts without authority but the principal's words or conduct lead third parties to believe the agent's actions are authorized, the principal is bound by those actions or obligations. For example, if a principal consigns goods to an agent with a minimum sale price but the agent sells below that price to a third party unaware of the restriction, the principal is obligated by the sale. Similarly, if an agent improperly sells negotiable instruments entrusted by the principal, the sale remains valid if third parties were led to believe the agent had authority.
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