Since the agency is created in many ways we find that under the case of Chad and Hamish this agency was formed by necessity, through which the law indicates that an authority may be conferred by law where an agent has acted by reason of a genuine emergency with a view to protecting his principal’s goods which are in danger of being perished or deteriorated. His action must have been performed in good faith.
He must not assume the role of an agent of necessity unless he is unable to communicate with the owner of the goods to obtain fresh instructions.The same thing applies in this case of Chad where we find that after falling sick he contracted Hamish who is a friend to look after his shop. He further goes on and tells him not to spend more than $10, 000 when he is hospital. and as a result of the business getting busier and his shop runs out of stock we see that Hamish purchases a stock that goes for $125,000 as a result of him being worried that he would not be in a position to make orders that are of a less amount of money that the above mentioned. (Gifford, 1980)In this case we therefore find that Hamish actually breached the contract by not adhering to the instructions he was given by his friend Chad. An agent is provided with the duties which may include: the agent must carry out the work undertaken according to his principal’s instructions.
Where he fails to act in accordance with the instructions, he will become liable for breach and will also entitle the principle to terminate his agency.In the case of Hamish we find that he actually failed to adhere to the instructions he was given by his principal Chad of not spending more than $10,000 as he was away from the business, this renders him liable for his actions and he will therefore be required to pay the Hot Surf their payments for the surfboards, in this case the Hot Surf are advised to ensure that they are given their payments as the law supports the payment of such incidences. (Gifford, 1980)We also find that the contemporary law provides that the agent must keep his principal well informed about all matters concerning the agency and must not disclose any information relevant to the agency to the third party.In this case we find that the agent never informed the principal over the matter of how he had decided to purchase the surfboards for more money than what Chad had recommended him to do, even though he never revealed this case the third party, he will still be held liable for the damages and this guarantees that Chad will be forced to pay the Hot surf their damages since he practiced Substancial performance.In the case Chad and Hot Surf we find that Hamish claims to have breached the contract due to the weather changes which led to the closure of the beach for a week and the cancellation of the surf carnival .This implies that the agent must carry out the work with reasonable care, skill and diligence and if he fails in this duty, he becomes liable to the principal for any loss suffered by him.
(Jertz and Miller, 2004)
