Question

(Business Law)

Discuss an agent's duty to communicate information to the principal and when is this duty considered to be violated?

Answer 1

Agents duty to communicate refers to the responsibility oft he agent to disclose all relevant and true information to the principal. Where the agent provides incorrect or incomplete information, this duty is said to be violated.

An agent is expected to make full, frank and prompt disclosure of the facts to his principal. He is supposed to know which information the principal will desire to have and should share the same with him.For instance, a share broker suggests investment in his brother's company without disclosing the relation with the owner. This is said to be a violation of his duty to communicate since he is concealing his personal interest in the firm.