Where the authority is stated to be for a limited period, the passing of the term terminates the agency.
If one is employed as agent for a certain time, the passing of that time terminates his authority. The parties may of course stipulate for a continuance and this might be shown by circumstances.
If the object of the agency is accomplished, the agency ceases.
If one is employed to do a certain act, as to sell a piece of real estate, his authority then ceases when the act is done.
Unless an agency is coupled with an interest in the agent it may be revoked at any time by the principal, though he may have no right to revoke.
Agencies may be divided into those which are revocable and those which are irrevocable. In considering whether an agency is revocable, we do not consider the right of revocation; we consider only the power, which is quite without respect to the right to revoke. I may revoke an agency whether I have any right to do so or not, just the same as I may discharge an employee, regardless of my right to do so. In such a case I may have to pay damages, but I cannot be compelled against my will to keep any certain person in my employ. But all agencies are not revocable. If the agent has an interest in the agency so that the agency must continue in order to protect that interest, the principal cannot revoke it. What constitutes an irrevocable agency is further considered in the following section.
If an agency is coupled with an interest it cannot be revoked by the principal. It is coupled with an interest only when the agent has some interest or estate in the subject matter of the agency.
An agency is irrevocable when the agent has an estate or interest in the subject matter of the agency. His interest in the agency itself, no matter how extensive it may be, is not sufficient to prevent even its wrongful termination.114 In that event the agent is in the same position as any other party to a contract which the other party has broken and may sue for his damages. But if besides that interest, he has an interest in the thing itself, his agency can no more be revoked than any property can be taken from a man without his consent. Thus if the agency must continue in order to reimburse the agent for expenditures made by him, or loans made by him to the principal or others, then in case the agency has been granted for the purpose of securing the lender, the agency is irrevocable. Thus if A should loan P $1,000, and a security for the loan should be given by P the authority to collect certain debts, P could not deprive A of this security by revoking the agency. But if P should employ A to sell land on commission, he could revoke the authority at any time, even though thereby depriving A of his fees, for A could have his damages and this right is as great a protection to him as though the agency had continued.
114. Chambers v. Seay, 73 Ala. 372.
If an agency is stated to be "irrevocable," it may nevertheless be revoked, unless coupled with an interest.115 But of course if there is no right to revoke it, its revocation will give rise to an action for damages.
A principal has the right as well as the power to revoke whenever the agency is for an indefinite period or without consideration, or where the agent has on his part broken his contract, or where it is in terms revocable.
If the agency is for an indefinite period it may be brought to a close at any time by either principal or agent; so even if a time is definitely stated, still if there is no consideration for its continuance it could be revoked at any time. Thus if the agent did not promise and so could not be held to do anything during such term, but had in substance or in terms agreed to act as he might see fit or desired, there would not be any contract for any definite period though the authority might so state. Sometimes an authority is given upon condition that it may be terminated at any time, or upon the happening of a certain contingency, or upon a certain notice to be given.
Example 28. A manufacturer of motor cars granted to H exclusive right to sell cars in a specified territory, but was not for any definite term and provided that the manufacturer could terminate whenever he believed H was not diligent in selling cars. Held, such agency was terminable at will.116
115. Todd v. Superior Court, 184 Pac. (Cal.) 684.
If an agent turns out to have less competency than the principal was justified in supposing he had, the principal may revoke the agency. Professional agents especially hold themselves out as having a certain degree of skill, and if they are wanting in that respect they need not be retained.
If the agent breaks his contract in any material way the principal may thereupon terminate the agency, or waiving the breach he may continue the agent in the agency. After he has once waived the breach, he could not afterwards rely on it as an excuse for terminating the agency.
Where an agent is employed for a specified period, but it is provided that the principal may discharge him if the agent's services become unsatisfactory, it is generally held that the dissatisfaction expressed must be genuine and in good faith, not a mere excuse for discharge. - (Atlanta Stove Works v. Hamilton, 83 Miss. 704).
An agent has the power, whether or not he have the right, to terminate the agency at any time. His right to terminate depends upon the same reasoning that governs the principal's right to terminate.
An agent has always the power to terminate the agency. But he may not have the right. That depends upon his contract and upon his principal's breach thereof. Agencies at will, or for an indefinite period, or for a definite period but without consideration, could be terminated by the agent at any time, just as they can by the principal.
116. Huffman v. Page-Detroit Co., 262 F. 116.
The principal must notify the agent when he revokes and usually the revocation consists in such notice.
An agent is entitled to notice when his authority is revoked. Usually the notice itself would constitute the revocation.
Where the agency is general, revocation does not usually operate as to third persons except upon notice to them, but no notice is usually necessary in special agencies, except where negotiations are actually being entered into thereunder.
Third persons who would under the circumstances be justified in dealing with an agent under the belief that his agency continued to exist are entitled to notice. Notice might be given them by the circumstances, as where an agent has been put out of possession of the office and others are in his place. Notice would seldom be required except in general agencies.