Agent is personally liable, can a third party still go on to sue the principal?

Home Forums Personal Liability of Principal and Agent Agent is personally liable, can a third party still go on to sue the principal?

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      The principal is generally liable for acts done by the agent within the principal’s authority. Under section 233 of the Indian contract act, 1872, even when the agent is personally liable, the third party can still go on to sue the principal, it is right of dealing with an agent personally liable, in case the agent is personally liable, and the persons deals with an agent, either the agent or principal becomes liable or both agent and principal can be held liable. If an agent enters a contract on his own, then the third party can hold him personally liable and the agent can also sue the third party, if the third party discovers the principal, under section 234 of the Indian contract act then the third party can sue both agent and principal or the liability can be sued individually. The liability of principal to the third parties comes when misrepresentation or fraud done by the agent at the time of contract, and the principal is liable at the time of existence of the contract and liable for the contracts made by his agent and neither principal existence nor undisclosed principal, then the agent can be sued personally. KUTTI KRISHNAN NAIR VS APPA NAIR in this case the plaintiff on a contract to supply timber and he sued two defendants principal and his agent but the liability of both principal and agent are not equal which has been taken from the case Morel brothers vs. the earl of Westmoreland. SK SIKKA VS HINDUSTAN PAPER CORPORATION LMTD, in this case, the supreme court stated that the plaintiff who has acted as an agent and has been founded that the agent has been playing fraud on the respondents and the court held the judgment under the provision of section 233 of Indian contract act, the defendants were held liable, and the repayment has to be done by principal or agent .so when an agent is personally liable, then the third party can still sue the principal.

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