An agent sells goods on credit to a person on behalf of his-00439
This subjective question is related to the book/course
vu cs301 Data Structures.
It can also be found in
vu cs301 Mid Term Solved Past Paper No. 1.
An agent sells goods on credit to a person on behalf of his principal without making proper enquiry about the solvency of that person. It seems from the above that selling on credit is the normal way of doing business. So as far as selling on credit is concerned the agent is entitled to do so. However as he sold goods to a person who was insolvent at the time of sale.
Principal is justified and must sue his agent for loss and the Principal's claim is right. The agent must have used reasonable care and diligence while selling the goods on credit. He should have by no means sold on credit to an insolvent person.
