New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    Under what circumstances can an agency relationship be

    terminated?
    A The agency is automatically terminated only when the principal explicitly revokes the agent’s authority, with no other factors influencing termination Correct Answer Incorrect Answer
    B The agency can only be terminated by the agent’s renunciation or the principal’s insolvency, but not by the completion of the business of the agency Correct Answer Incorrect Answer
    C The agency remains in effect until the principal explicitly revokes the agent's authority, regardless of any other events such as death or completion of the business Correct Answer Incorrect Answer
    D The agency is terminated solely by the completion of the business, with no other factors leading to its termination Correct Answer Incorrect Answer
    E The agency can be terminated by various events, including the principal revoking the agent's authority, the agent renouncing the business, the completion of the business, the death or unsoundness of mind of either party, or the principal being adjudicated insolvent Correct Answer Incorrect Answer

    Solution

    Contract Act Section 201.   Termination of agency: An agency is terminated by the principal revoking his authority; or by the agent renouncing the business of the agency; or by the business of the agency being completed; or by either the principal or agent dying or becoming of unsound mind; or by the principal being adjudicated an insolvent under the provisions of any Act for the time being in force for the relief of insolvent debtors.

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