Law of Agency

In Malaysia, the law of agency is governed by Part X of the Contracts Act 1950.
Section 135 of the Act defines

"a person employed to do any act for another or to represent another in dealings with third persons and a principal"

as the person for whom such act is done, or who is so represented. From the definition above, it can be said that the contract of agency is divided into two:

(a) A contract between the principal and agent, where the agent attains the authority to act for and on behalf of the principal;

and

(b) A contract between the principal and third party through an agent.
An agent can therefore make contracts with third parties that are binding on the
principal.