AUTHORITY OF AN AGENT

It is important to know the extent of an agent's authority because any act done by the agent within his authority will bind the principal. The agent's authority is classified into:

(a) Actual authority

and

(b) Apparent authority.


1. Actual Authority

(a) Express actual authority
Express actual authority is expressly given by the principal (orally or in writing) to the agent.

For example, T appoints S as his agent to purchase goods not exceeding RM10,000. In such case, S actual authority is to purchase goods on behalf of T, not exceeding RM10,000.

(b) Implied actual or usual authority
Implied actual authority is the proper or necessary authority given to the agent to execute the express authority. For example, T appoints S as his agent to sell T's car. S has implied authority to allow the purchaser to test drive the car.