Indian Contract Act Section 211 — Agent’s duty in conducting principal’s business

CHAPTER X AGENCY — Agent’s duty to principal

Commercial / Corporate

Summary

An agent must run the principal's business by following the principal's instructions. If the principal gives no instructions, the agent must follow the usual custom for that type of business in the place where the agent operates.

If the agent acts against these rules, the agent must cover any loss the principal suffers, and must hand over any profit the agent makes from that action.

Official Text

An agent is bound to conduct the business of his principal according to the directions given by the principal, or, in the absence of any such directions, according to the custom which prevails in doing business of the same kind at the place where the agent conducts such business. When the agent acts otherwise, if any loss be sustained, he must make it good to his principal, and if any profit accrues, he must account for it. Illustrations