AIR 1915 MADRAS 859(2)

Madras High Court

Hon'ble Judge(s): Sankaran Nair, Spencer , JJ

Contract Act (9 of 1872) , S.196, S.197— Loan advanced by agent beyond authority-Principal's acquiescence and interference in mode of collection absolves agent from personal liability. Where the principal not only did not object to the propriety of his agent advancing certain loans and did not tell him that he would hold him responsible for any loss that he might sustain thereby, but even interfered with the collection of the debts, dictated his own terms and allowed with full knowledge of the circumstances the agent's successor to take the debts at a certain valuation, after which it was no longer open to the first agent to collect the debts himself : Held : that the principal was precluded by his acquiescence from questioning the validity of these transactions and could not hold the agent liable for damages sustained.