Effect of agency on contracts with third persons
Contracts entered into through an
agent, and obligations arising from acts done by an agent, may be enforced in the same manner, and will
have the same legal consequences, as if the contracts had been entered into and the acts done by the
principal in person.
Illustrations
(a) A buys goods from B, knowing that he is an agent for their sale, but not knowing who is the principal. B’s principal is the
person entitled to claim from A the price of the goods, and A cannot, in a suit by the principal, set-off against that claim a debt
due to himself from B.
(b) A, being B’s agent, with authority to receive money on his behalf, receives from C a sum of money due to B. C is
discharged of his obligation to pay the sum in question to B.