Difference Between Agent and Servant
1. Definition
Agent
An agent is a person authorized to act on behalf of another (called the principal) to create legal relations with a third party. The actions of an agent legally bind the principal.
Legal basis: Sections 182–238 of the Indian Contract Act, 1872 deal with agency.
Example: A company authorizes a manager to sign contracts on its behalf.
Servant
A servant (or employee) is a person employed to perform services under the control of another (called the master). The relationship is primarily governed by employment contract laws.
Legal basis: Common law, Industrial Employment laws, and the Indian Contract Act (contract of service is distinguished from contract of agency in Sec. 230).
Example: A factory worker working under a supervisor is a servant.
2. Nature of Relationship
| Aspect | Agent | Servant |
|---|---|---|
| Authority | Acts on behalf of the principal with authority to bind him. | Acts under the direction and control of the master; cannot bind the master in contracts. |
| Control | Principal controls result, not the detailed mode of work. | Master controls manner, method, and details of work. |
| Obligation | Fiduciary duty to act in the principal's best interest. | Duty to obey lawful orders; less fiduciary nature. |
| Remuneration | Usually paid commission or agreed fee. | Paid wages or salary. |
| Contractual Binding | Acts can create legal relations for principal. | Acts generally bind only the servant, not the master (unless acting within scope of employment). |
3. Examples of Acts
Agent: Selling goods, signing contracts, hiring other employees on behalf of the principal.
Servant: Sweeping, cooking, clerical work, performing assigned tasks.
4. Control Test and Distinguishing Principle
Courts often distinguish agents and servants by degree of control:
Agent: Principal cares about results, not how they are achieved.
Servant: Master directs every step, both method and result.
5. Case Law
Watson v. Marshall (1901) 1 KB 121
A person employed to perform certain services but acting independently to achieve results was held an agent, not a servant.
Yewens v. Noakes (1880) 6 QBD 530
The court distinguished “officer” or “servant” based on control and mode of work, emphasizing that servants are under the master’s detailed supervision.
Hawley v Luminar Leisure Ltd (2006)
The court clarified that the key difference is whether the person acts for the principal’s benefit (agent) or performs duties for wages under supervision (servant).
6. Summary Table
| Feature | Agent | Servant |
|---|---|---|
| Relationship | Principal-Agent | Master-Servant |
| Authority to bind | Yes | No (unless authorized) |
| Control over work | Result-based | Method & result-based |
| Payment | Commission, fees | Salary, wages |
| Duty | Fiduciary | Obedience & performance |
| Legal effect of acts | Binds principal | Usually binds servant only |
| Key Test | Authority & result | Control & supervision |
Conclusion:
The main difference lies in authority and control. An agent is empowered to act legally on behalf of the principal, while a servant works under the master’s control and does not usually bind the master in legal relations.
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