Section 235 The Indian Contract Act, 1872
Section 235 of the Indian Contract Act, 1872 deals with the liability of a person falsely representing himself as an agent.
🔹 Section 235 – Liability of person falsely contracting as agent
A person untruthfully representing himself to be the authorised agent of another, and thereby inducing a third person to deal with him as such agent, is liable, if his alleged employer does not ratify his acts, to make compensation to the other in respect of any loss or damage which he has incurred by so dealing.
🔍 Explanation:
This section addresses situations where:
A person falsely claims to be an agent of someone else.
He induces a third party to enter into a contract, making them believe the contract is with the real principal.
If the supposed principal refuses to ratify (approve) the act,
👉 then the fake agent is personally liable to compensate the third party for any resulting loss or damage.
🧑⚖️ Illustration:
X claims to be the agent of Y and agrees to sell goods on Y’s behalf to Z.
Z relies on X’s word and pays the money.
Later, it turns out Y never authorized X, and does not ratify the deal.
Then, X is personally liable to compensate Z for the loss.
📌 Key Points:
This section protects third parties who rely on false representations of agency.
The liability arises only when the alleged principal refuses to ratify the unauthorized act.
The person falsely acting as an agent becomes liable as if he were a principal in a misrepresentation.
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