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UNIVERSITY EXAM PREPRATION MATERIALS
CASE
LAWS: CONTRACT LAW
Dec
- 2012
A directs B to sell his estate. B on look over the estate before selling it, finds a mine on the estate unknown to A. B informs A that he wishes to buy the estate for himself, but conceals the discovery of the mine. A allows B to buy in ignorance of the existence of the mine. Decide.
Answer:
Under
section 215 of the Indian Contract act, 1872 specifies the duty of the Agent as
to not deal with agency business on his own account.
If
an agent deals with the business of agency on his own account without the principal’s consent, then the principal may:
Repudiate
the transaction if there is any dishonest concealment of facts.
Repudiate
the dealings which are disadvantageous to him. In the given case, A is unaware
of the presence of the mine on the estate which he puts up for sale. B, the
agent of A deliberately conceals the fact of existence of the mine and obtains
the consent the fact of existence of the mine and obtained the consent of A to
buy the estate himself to take benefit of the presence of the mine.
As
this is a clear case of dishonest concealment of a material fact on the part of
the agent to benefit himself, A has the power to repudiate the contract as
brought out under the above section of the act.
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