Legal Definitions - agent

An agent is an individual or entity empowered to act on behalf of another person or organization, known as the principal. This authorization means the agent can make decisions, enter into agreements, or perform actions that legally bind the principal, as if the principal had done them directly. The relationship between an agent and a principal can be formally established through a written agreement or can arise implicitly from their conduct and the circumstances.

• Example 1: Real Estate Agent

  Imagine a homeowner, Sarah, wants to sell her house. She hires Mark, a licensed real estate agent, to handle the sale. Sarah (the principal) authorizes Mark (the agent) to list her property, show it to potential buyers, and negotiate offers on her behalf. When Mark presents an offer and Sarah accepts it, Mark's actions in facilitating that agreement legally bind Sarah to the sale, provided he acted within the scope of his authority.

• Example 2: Company Purchasing Manager

  Consider a large technology company, "TechSolutions Inc.," that needs to purchase thousands of computer chips for its new product line. The company's purchasing manager, David, is responsible for sourcing these components. David (the agent) negotiates and signs a supply contract with a chip manufacturer. In this scenario, TechSolutions Inc. (the principal) is legally bound by the contract David signed, because David was authorized to act as an agent for the company in making such purchases.

• Example 3: Literary Agent

  An aspiring author, Emily, has just finished her first novel and wants to get it published. She secures a literary agent, Laura, to represent her. Emily (the principal) authorizes Laura (the agent) to submit her manuscript to various publishing houses, negotiate publishing contracts, and manage foreign rights. When Laura successfully negotiates a book deal with a publisher and presents the contract to Emily for signing, Laura's efforts and the terms she secured are done on Emily's behalf, legally binding Emily to the agreement once she approves and signs.