The Indian Contract Act, 1872
230. Agent cannot personally enforce, nor be bound by, contracts on behalf of principal –
In the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
PRESUMPTION OF CONTRACT TO THE CONTRARY. –
Such a contract shall be presumed to exist in the following cases :-
(1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad;
(2) where the agent does not disclose the name of his principal; and
(3) where the principal, though disclosed, cannot be sued.
Comments
When agent can be sued
Before the agent can be sued it must be pleaded and shown that the principal is undisclosed and the contract, the breach of which is sued on was entered into by the agent as having contracted personally. Where the contract is entered into by agent contracting on behalf of a foreign principal who is named and disclosed, the agent can not be sued personally nor made personally liable; Midland Overseas v. “CMBT Tana”, AIR 1999 Bom 401.
