When the Agency is created through legal protection or ratification, the agent`s responsibility depends on the agent`s conduct. The agent undertakes to compensate, defend and protect the company from and before any action and any costs related to a violation of the law, this agreement or the rights of third parties by the agent while acting in accordance with this Agreement. These fees include, but are not limited to reasonable legal fees. Nor can the awarding entity revoke the authority of the authorized officer after having partially exercised it to hire him (see 204), although it can still do so before that authority has been exercised (see 203). In addition, if the Agency is scheduled for a specified period under p. 205, the contracting entity cannot terminate the Agency before the deadline expires, unless that is the case for a sufficient reason. If this is the case, he is required to compensate the officer for the harm he has suffered. The same rules apply when the agent renounces an agency for a specified period of time. Note in this regard that lack of skill, persistent disobedience to legitimate orders, and rude or offensive behaviour were considered sufficient reason for the release of an officer.
In addition, one party must assign appropriate communication to the other, in a partisan manner; otherwise, damage caused by the absence of such communication must be paid (see 206). In accordance with p. 207, the revocation or renunciation of an agency may be done, expressly or implicitly, by conduct. The termination will not take effect for the agent until it is known to the agent and the third party until they know of the termination (see 208). Agency agreements can be entered into if you ask a seller, accountant, lawyer or other third party to make transactions on your behalf. In 1986, the European Communities adopted Directive 86/653/EEC on independent trade agents. In the United Kingdom, this was transposed into national legislation in the regulations of trade agents in 1993.  Thus, in a commercial representation relationship, representatives and contracting entities are subject to the rules of common law and commercial agents. The general rule is that when an agent acts outside its powers, any agreement reached on behalf of the client is not binding.
An exception to this rule is when the agent`s conduct is later ratified by the adjudicating entity as having the authority of the adjudicating entity. In Watteau v Fenwick, Lord Coleridge CJ on Queen`s Bench accepted Wills J.`s opinion that a third party could personally incur liability for a sponsor he did not know about while selling cigars to an agent acting outside his authority. Wills J. stated that “the client is responsible for all the agents` actions that are generally entrusted to an agent of this type, regardless of the restrictions imposed between the captain and the agent of that authority.” This decision was strongly criticised and questioned, although it was not completely overturned in the United Kingdom. It is sometimes called “the usual authority” (but not in the mind of Lord Denning MR in Hely-Hutchinson, where it is synonymous with “real implied authority”). It has been declared as a form of apparent authority or “intrinsic agency power.” The legal relationship between the agent and the client will depend on how the Agency was created. An agency can be created in different ways: alternatively, the Agency can be terminated by law: the internal agency relationship can be dissolved by mutual agreement. According to sections 201 to 210 of the Indian Contract Act 1872, an agency can be terminated in a variety of ways: this practical note deals with the relationships between the contractors, the agents and the third parties with whom the agent acts on behalf of the client.