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Bare Act · Indian Contract Act, 1872 · Chapter X
Chapter X · Sections
182 · “Agent” and “principal” defined. 183 · Who may employ agent. 184 · Who may be an agent. 185 · Consideration not necessary. 186 · Agent’s authority may be expressed... 187 · Definitions of express and implied... 188 · Extent of agent’s authority. 189 · Agent’s authority in an emergency. 190 · When agent cannot delegate. 191 · “Sub-agent” defined. 192 · Representation of principal by... 193 · Agent’s responsibility for... 194 · Relation between principal and... 195 · Agent’s duty in naming such... 196 · Right of person as to acts done... 197 · Ratification may be expressed or... 198 · Knowledge requisite for valid... 199 · Effect of ratifying unauthorized... 200 · Ratification of unauthorized act... 201 · Termination of agency. 202 · Termination of agency, where agent... 203 · When principal may revoke agent’s... 204 · Revocation where authority has... 205 · Compensation for revocation by... 206 · Notice of revocation or... 207 · Revocation and renunciation may be... 208 · When termination of agent’s... 209 · Agent’s duty on termination of... 210 · Termination of sub-agent’s... 211 · Agent’s duty in conducting... 212 · Skill and diligence required from... 213 · Agent’s accounts. 214 · Agent’s duty to communicate with... 215 · Right of principal when agent... 216 · Principal’s right to benefit... 217 · Agent’s right of retainer out of... 218 · Agent’s duty to pay sums received... 219 · When agent’s remuneration becomes... 220 · Agent not entitled to remuneration... 221 · Agent’s lien on principal’s... 222 · Agent to be indemnified against... 223 · Agent to be indemnified against... 224 · Non-liability of employer of agent... 225 · Compensation to agent for injury... 226 · Enforcement and consequences of... 227 · Principal how far bound, when... 228 · Principal not bound when excess of... 229 · Consequences of notice given to... 230 · Agent cannot personally enforce,... 231 · Rights of parties to a contract... 232 · Performance of contract with agent... 233 · Right of person dealing with agent... 234 · Consequence of inducing agent or... 235 · Liability of pretended agent. 236 · Person falsely contracting as... 237 · Liability of principal inducing... 238 · Effect, on agreement, of...
237

Liability of principal inducing belief that agent’s unauthorized acts were authorized.

When an agent has, without authority, done acts or incurred obligations to third persons on behalf of his principal, the principal is bound by such acts or obligations, if he has by his words or conduct induced such third persons to believe that such acts and obligations were within the scope of the agent’s authority.

Illustrations

(a)A consigns goods to B for sale, and gives him instructions not to sell under a fixed price. C, being ignorant of B’s instructions, enters into a contract with B to buy the goods at a price lower than the reserved price. A is bound by the contract.

(b)A entrusts B with negotiable instruments endorsed in blank. B sells them to C in violation of private orders from A. The sale is good.

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