Implied Authority to contract is a legal term in

contract law A contract is an agreement that specifies certain legally enforceable rights and obligations pertaining to two or more Party (law), parties. A contract typically involves consent to transfer of goods, Service (economics), services, money, or pr ...

referring to the implied ability of an individual to make a legally binding contract on behalf of an organization by way of uniform or interaction with the public on behalf of that organization. For example, a person carries implied authority when they are wearing a

uniform A uniform is a variety of costume worn by members of an organization while usually participating in that organization's activity. Modern uniforms are most often worn by armed forces and paramilitary organizations such as police, emergency serv ...

or nametag bearing the

logo A logo (abbreviation of logotype; ) is a graphic mark, emblem, or symbol used to aid and promote public identification and recognition. It may be of an abstract or figurative design or include the text of the name that it represents, as in ...

trademark A trademark (also written trade mark or trade-mark) is a form of intellectual property that consists of a word, phrase, symbol, design, or a combination that identifies a Good (economics and accounting), product or Service (economics), service f ...

of a business or organization, or when they are functioning in an authorized capacity on behalf of a business or organization. An implied authority is authority that is not expressly granted by the contract, but that is assumed by the agent in order to have the ability to transact insurance business on behalf of the principal, regardless of what the contract specifically states. Besides implied authority, there is apparent authority and express authority may apply, these three being known as The Agency Relationship. In relation to

companies A company, abbreviated as co., is a legal entity representing an association of legal people, whether natural, juridical or a mixture of both, with a specific objective. Company members share a common purpose and unite to achieve specifi ...

, apparent authority is usually referred to as " ostensible authority".

India

Section 186 of the Indian Contract Act 1872 provides that an agent's authority may be express or implied. Section 187 adds that "An authority is said to be express when it is given by words, spoken or written. An authority is said to be implied when it is to be inferred from the circumstances of the case; and things spoken or written or the ordinary course of dealing, may be accounted circumstances of the case". The Act also includes an "illustration" of how this section operates:

References

Contract law {{Law-term-stub

India

See also

References