The flexibility of the law with respect to its provisions relating to the Agency allows for a derogating from the fundamental legal principle of “privity of contract”; In other words, contractors cannot delegate rights or obligations relating to the contract to anyone but themselves. A P-A allows a party such as a broker (but often a seller of goods or a “seller”) to create legal relationships (. B, for example, a lease agreement) linking a third-party lease to the final customer. If identity is essential to a contract, the doctrine of the undisclosed principle is not permitted. A good example of this would be to buy a painting from a popular artist: you would expect the artist to have painted the painting, not an unexplored principle of the artist (who probably could not paint to save his life). Said v Butt (1920) challenged the doctrine to prohibit a film critic from having a ticket to the opening night of a show (The Whirligig) where the host of the show did not want him to be present. Although rooted in potentially outdated cultural traditions, the case has not been quashed. In Dyster v Randall (1926), it was found that the identity of a land buyer was not essential to the estate contract concluded. If a third party knows nothing about the agent acting as a client, the Agency and the client are known as undisclosed. The agent of an unsigned client may be held liable in the contract as an effective debtor, since he has contracted in that capacity.
Similarly, an undisclosed client may be held responsible, since he must also bear his or her expenses. Thus, the lenders and borrowers/tenants are directly and totally linked to each other by the technique of the P-A contract in the tenancy agreement, as if each had directly signed a contract with the other. Similarly, an agent is liable if he does not disclose the agency and the identity of the client during the contracting work. In this case, the agent is subject to all contractual debts, as if the representative were the principal interested. Also keep in mind that the right of a contractor/financier to impose a contract is primarily above the rights of the agent. In general, the courts do not regard contractual terms as an exclusion from the intervention of an undisclosed client, unless the agent as a sole contractor is clearly intentional and thus documented. The agency`s concepts disclosed and undisclosed have already been briefly mentioned. The undisclosed agency is the usual type of agency where a third party knows that they are working through an agent. In an undisclosed agency, a third party does not know whether or not they are working on an agent. According to Cooke-Sons v Eshelby (1887), where an agent sometimes acts for a client, and sometimes in his own name, an agreement should be treated as if it were executed within an undisclosed agency. If no client is involved and the agent actually acts on his own behalf, no problems can arise, but it is up to the third party to take the risk that a client may be involved and that third party will inquire about whether an agent is involved: if the agent is lying, the contract is not valid for a misrepresentation. Financing leases under a main contract and agency contract (“AP”) is a common financing technique for the supply of commercial equipment in all states of Australia.
The law itself, which can be traced back to the reign of Lord Tenterde de Thompson v Davenport in 1829, but ultimately formalized somewhat differently from Parke B to Heald v Kenworthy in 1855, suggests that there is an agency relationship, but if it is not revealed at all, the counterparty may sue the agent or (if his identity appears later) the sponsor.