Business law

The issue of this case is whether Freeze Bad has acted as an agent of necessity in the situation and qualified to claim for warehouse storage charges from Nice to Eat Restaurant (NERD). Section 142 Contract Act 1950 states, “An agent has authority, in an emergency, to do all such acts for the purpose of protecting his principal from loss as would be done by a person of ordinary prudence, in his own case, under similar circumstances. ” According to Section 142, an agency by necessity may arise under retain circumstances a person may become an agent of another without having appointed as such.

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Such an agency relationship Is definitely recognized by the court. Yet, there are three conditions to be fulfilled to create an agency of necessity : a) It must be a situation that Impossible for the agent to get the principals Instructions In carrying out such action. B) The agent’s action Is necessary, to protect the principal from loss of the respective goods committed to his charges. C) The agent of necessary has acted In a good faith. In Great Northern Railway co.

V Sheffield, the defendant entrusted the plaintiff. Railway company to carry his horse to its destination. However, there was no one to receive the horse at the railway station and the station master could not get any instruction from the defendant at the time, the plaintiff sent the horse to stable as alternative and claimed the charges for the stable. The court held that the defendant must pay for the charges for stable since plaintiff have had no choice but to arrange roper care for the horse on behalf the defendant.

The plaintiff was an agent of necessity by fulfilling the three conditions stated above. In the case of Freeze Bad. (FEB.) and Nice to Eat Restaurant (NERD), FEB. was entrusted by NERD to deliver the frozen seafood to its destination but NERD has been closed for one week. Thus, no one receive the container of frozen seafood and Fib’s driver could not get any instruction of any Nerds representatives, Fib’s driver stored Nerds container in a nearby warehouse under Fib’s instruction.

Therefore, FEB. has acted as agent of necessity in this case since FEB. has fulfilled the three conditions above to create agency of necessity. First, FEB. could not get the Nerds instruction of how to handle the container, next, the action is done under necessity option to protect loss from the container of frozen seafood for NERD, FEB. also acted in the good faith to prevent the frozen seafood from being rotted. So, FEB. is entitled to claim for the warehouse storage charges from NERD as FEB. was an agent of necessity for NERD In this case.