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WorksheetsLaw of Agency in Malaysia Quiz Topic 4
Total questions: 24
Worksheet time: 12mins
What is the primary legal framework governing the law of agency in Malaysia?
Partnership Act 1961
Contract Act 1950
Sale of Goods Act 1957
Companies Act 2016
Which of the following best defines an agent according to the Contract Act 1950?
A person who hires employees on behalf of a company.
A person who acts on behalf of another in dealings with third parties.
A person who manages a business without authorization.
A person who represents a company in court.
What is the age requirement for someone to be a principal under the Contract Act 1950?
16 years
18 years
21 years
25 years
Which of the following is NOT a method of forming an agency?
By express appointment
By implied appointment
By mutual agreement
By necessity
In which situation can an agency by necessity be created?
When the agent exceeds their authority.
When the principal has expressly forbidden the action.
When it is impossible for the agent to obtain the principal's instructions.
When the agent is under the age of 18.
What type of agent is responsible for ensuring that the principal is paid by the third party?
Broker
Factor
Del Credere Agent
Commission Agent
Which of the following rights does a principal have towards an agent?
To delegate the agent's authority
To prevent the agent from earning commission
To indemnify the agent for authorized expenses
To terminate the agency without reason
What must an agent do if they have received sums on behalf of the principal?
Keep the money for personal use
Pay the sums to the principal
Donate the money to charity
Invest the money in stocks
Which type of authority is not expressly given by the principal but is assumed to exist?
Actual Authority
Apparent Authority
Implied Authority
Express Authority
Under what circumstance can a principal ratify an unauthorized contract made by an agent?
The contract must be unlawful.
The contract must have been made with a minor.
The principal must have full knowledge of all material facts.
The principal must be present at the time of contract formation.
According to Section 164 of the Contract Act, what is the primary duty of an agent?
To act independently of the principal
To follow the principal's lawful instructions
To disregard the principal’s instructions for their own benefit
To seek approval from third parties
In the case of Turpin v Bilton, what was the outcome for the agent?
The agent was found not liable.
The agent was liable for breach of duty due to failing to follow instructions.
The principal was found at fault.
The agent was entitled to compensation.
When instructions are not given by the principal, what must the agent rely on according to Section 164?
Their personal judgment
The customs of the trade
Advice from third parties
The principal’s past behavior
Under Section 165 of the Contract Act, an agent is required to:
Ignore the principal's instructions
Exercise care, skill, and diligence
Act only in their own interest
Avoid any financial responsibility
What must an agent do when required by the principal, as stated in Section 166?
Ignore the request
Provide proper accounts for all transactions
Keep all financial matters secret
Delegate the task to someone else
In the case of Lyell v Kennedy, what was the ruling regarding the agent's responsibility?
Agents can mix their funds with the principal's.
Agents must keep the principal's money or property separate.
Agents are not required to account for funds.
The principal must keep the accounts.
What are the conditions under which an agent may deduct amounts before paying the principal, as per Section 171?
Only the agent's commission
Advances paid and agent’s remuneration
Any personal expenses of the agent
Only the agent’s salary
According to Section 167, what is the agent's duty regarding communication with the principal?
To avoid all forms of communication
To communicate regularly and use discretion in emergencies
To only communicate when convenient
To seek third-party advice before communicating
What is the implication of Section 169 regarding an agent's personal interests?
Agents can prioritize their interests over the principal’s.
Agents must not allow their personal interests to conflict with their duty.
Agents can use inside information for personal gain.
Agents are free to act without any restrictions.
In the case of Tan Kiong Hwa v Andrew S. H. Chong, what was the agent's breach of duty?
The agent sold the property for a higher price without consent.
The agent disclosed confidential information.
The agent mismanaged the property.
The agent failed to communicate effectively.
How can an agency be terminated by agreement?
When the principal is unhappy with the agent
When both parties agree and provide reasonable notice
By the agent's own decision
When the principal makes a new contract with someone else
What occurs when the principal revokes the agent's authority?
The agent automatically retains all authority.
The agent may still act on behalf of the principal.
The authority can only be revoked before it has been exercised.
The principal must provide compensation to the agent.
Which circumstance does NOT lead to termination of agency by operation of law?
Death of either principal or agent
Insanity of the agent or principal
Completion of the agency's purpose
Personal disagreement between principal and agent
What does the case of Stevenson v Aktiengesellschaft fur Cartonnagen highlight about agency?
Agency cannot be terminated.
Agency can be terminated due to frustration caused by unforeseen events.
Agents are allowed to act independently.
All agency contracts last indefinitely.
