Such an agency can be terminated by the principal at his will
Such an agency can be terminated on the death or insanity of the principal
Such an agency cannot be terminated at all
Such an agency can be terminated only upon an express contract to the said effect
Answer is Wrong!
Answer is Right!
The correct answer is: A. Such an agency can be terminated by the principal at his will.
An
agency in which the agent himself has an interest in the subject matter is called a “del credere agency.” In a del credere agency, the agent agrees to be personally liable for the debts of the principal’s customers. This means that if the principal’s customers do not pay their debts, the agent is responsible for paying them.Because of the personal liability of the agent in a del credere agency, the principal has the right to terminate the agency at any time. This is because the principal does not want to be exposed to the risk of the agent’s personal liability.
The other options are incorrect because:
- Option B is incorrect because the death or insanity of the principal does not automatically terminate a del credere agency. The agent may still be liable for the debts of the principal’s customers.
- Option C is incorrect because a del credere agency can be terminated by the principal at any time.
- Option D is incorrect because a del credere agency does not require an express contract to the said effect. The principal has the right to terminate the agency at any time, even if there is no express contract to that effect.