Under Section 16 of the BSA 2023 (corresponding to Section 18 IEA), admissions made by agents are binding on the principal. What is the key requirement?
- A
Any statement by any employee binds the company
- B
For an agent's admission to bind the principal, the admission must be made by the agent in the course of and within the scope of his authority to make the admission; the agent must be authorised, expressly or impliedly, to make statements on behalf of the principal in relation to the matter in question
- C
Only written admissions by agents are binding
- D
Agency must be created by a registered power of attorney
View answer and explanation
Correct answer: B. For an agent's admission to bind the principal, the admission must be made by the agent in the course of and within the scope of his authority to make the admission; the agent must be authorised, expressly or impliedly, to make statements on behalf of the principal in relation to the matter in question
Section 16 BSA 2023 (Section 18 IEA) provides that admissions made by the following persons are relevant as admissions: (1) Parties to the suit; (2) Agents expressly or impliedly authorised; (3) In representative suits, persons in whose representative capacity the party sues or is sued; (4) Persons from whom the parties derived their interest in the subject matter; (5) Persons having a proprietary or pecuniary interest in the subject matter who make the statement in that character. For AGENT'S ADMISSIONS: the admission is only binding on the principal if made within the scope of the agent's authority. A lawyer who makes an admission in open court binds his client if it relates to matters within the lawyer's conduct of the case. A company's managing director's admission about company business made during business operations binds the company. Contrast: an employee's personal statement about the employer's affairs made outside the scope of employment does NOT bind the employer as an admission under Section 16 BSA.
Source note: BSA 2023 Section 16