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Under Section 201 of the Indian Contract Act, 1872, what is the general rule on termination of an…

Section 201 lists revocation by the principal, renunciation by the agent, completion of the agency business, death or unsoundness of either party, and adjudication of the…

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Under Section 201 of the Indian Contract Act, 1872, what is the general rule on termination of an agency by death, unsoundness of mind or adjudication of insolvency?

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Answer and explanation

Correct answer A

Section 201 lists revocation by the principal, renunciation by the agent, completion of the agency business, death or unsoundness of either party, and adjudication of the principal as insolvent under the applicable law. Section 202 protects an agent's interest in the subject matter of the agency in the absence of an express contract to the contrary.

Option feedback

Option A

Section 201 names death or unsoundness of either party and adjudication of the principal as insolvent.

Option B

Section 201 specifies adjudication of the principal as insolvent. It does not name the agent's insolvency as such a ground.

Option C

Death or unsoundness of either the agent or the principal is listed. The insolvency ground identifies the principal.

Option D

Death or unsoundness of the principal can also terminate the agency. The insolvency ground identifies the principal.

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