Applications in jurisdictions Law of agency

agency law in united kingdom component of uk commercial law, , forms core set of rules necessary smooth functioning of business. agency law governed common law , lesser extent statutory instruments.

in 1986, european communities enacted directive 86/653/eec on self-employed commercial agents. in uk, implemented national law in commercial agents regulations 1993. thus, agent , principals in commercial agency relationship subject both common law , commercial agents regulations.

the commercial agents regulations require agents act “dutifully , in faith” in performing activities (reg. 3); co-extensively, principals required principals act “dutifully , in faith” in “relations” commercial agents (reg 4). though there no statutory definition of obligation act “dutifully , in faith”, has been suggested requires principals , agents act honesty, openness , regard interests of other party transaction . 2 normative precepts assist in concretising standard of conduct:

firstly, expressing honesty , openness, commercial agents , principals must mutually co-operate in performance of agreement. conduct in faith requires each party proactively take action assist other in realisation of bargain, opposed mere abstention obstructive behaviour. however, whether party has acted in faith must not determined reference moral or metaphysical notion of co-operation; assessment must based on objective appraisal of actual commercial agency relationship. accordingly, intensity of required co-operation vary, depending on terms of contract , pertinent commercial practices.

secondly, commercial agents , principals must not exploit asymmetries in agency relationship in such manner frustrates legitimate expectations of other party. in respect, whether conduct in breach of obligation must appraised holistically, considering aspects of relationship; material facts include contractual , commercial leverage of each party, objective intentions enshrined in contract, , business practices of sector in question. nevertheless, starting axiom of investigation must these commercial relationships in professionals expected self-reliant , must free pursue self-interest. critically, not estimation aimed @ achieving ontological fairness, bargain or equilibrium between giving , receiving of commercial agents , principals .