Agency by Necessity

MoneyBestPal Team
A legal doctrine that allows a person to act on behalf of another without their consent or authorization when there is an emergency situation.

Agency by necessity is a legal doctrine that allows a person to act on behalf of another without their consent or authorization when there is an emergency situation that requires immediate action to prevent harm or loss. 

The theory is founded on the idea that, in such situations, the law infers the agreement of the principal (the person on whose behalf the action is conducted), and that the agent (the person who acts) has a responsibility to uphold the interests of the principal.

A real and impending requirement, acting in good faith and with due attention, and acting within the bounds of necessity are the three fundamental components of the doctrine of agency by necessity. Let's look more closely at each component one by one.

First, there must be an actual, pressing need that compels the agent to take action. This indicates that there is no opportunity to secure the principal's approval or consent, or that doing so is either impossible or impractical. For instance, a bystander may act as their agent by necessity and summon an ambulance or transport the unconscious individual to the hospital if they need urgent medical care. Also, the necessity must be justified and not just based on expediency or idle speculation. For instance, if a person forgets to retrieve their car keys from a friend, the friend is not permitted to use the vehicle without their consent unless there is an urgent situation that necessitates it.

Second, the agent must exercise reasonable diligence and good faith in all dealings. This requires the agent to behave honestly, in the principal's best interests, and not for their own gain or advantage. Additionally, the agent is required to carry out the action with reasonable care and competence, without causing any unnecessary pain or damage. As an illustration, if someone gives a hotel their belongings to store, and the hotel is in danger of fire, the hotel staff can act as agents out of necessity and transport the items to a safer location. But, they are not allowed to take them, harm them, or utilize them for their own gain.

Lastly, the actor must stay within the necessity's bounds and not go beyond it. This means that the agent must only take the actions required by the situation in order to avoid or lessen the harm or loss. The agent must also quit operating as soon as the need disappears, the principal regains capacity, or the principal delivers instructions to the contrary. For instance, a friend can act as their agent out of necessity and withdraw money from their bank account if the person needs money to get home while stranded in a distant nation. But, they cannot take out more money than is required for travel expenditures or use it for anything else.

For both agents and principals, the idea of agency by necessity has a number of ramifications. For agents, it means that as long as they adhere to the doctrine's guidelines, they can operate without worrying about facing legal repercussions or breach of contract. Yet they must also be ready to defend their choices and pay for any costs or losses they may have caused. For principals, it means that even if they did not give their consent or authorization, they are nonetheless legally responsible for the activities of their agents. But, if their representatives behaved carelessly or dishonestly, they may also be held liable for any losses or damages.

The significant and practical idea of agency by necessity empowers people to take action in dire circumstances when there is no other course of action. It should not, however, be exploited or utilized improperly because it places obligations on both agents and principals.