What is the difference between sub-agent and co-agent?

Answer 1

Section 191 of Indian Contract Act 1872 defines that "a sub-agent is a person employed by, and acting under the control of, the original agent in the business of the Agency." A sub-agent may be a properly appointed one or an improperly appointed one. Where an agent, having authority to do so, appoints a sub-agent, he is known as a sub-agent properly appointed (sec. 192.) Where an agent without authority appoints a sub-agent, he is called a sub-agent improperly appointed. ( sec. 193.)

When a sub-agent is properly appointed, he can represent the principal as regards to third parties. There is no privity of contract between the sub-agent and the principal. The agent would be responsible to the principal for the acts of the sub-agent. In case of a fraud or willful wrong, the sub-agent is also directly responsible to the principal.

When the sub-agent is improperly appointed, the principal is not bound by the acts of the sub-agent. The agent would be responsible to the principal and third parties.

A "Co-agent" or a "substituted Agent" is a person who is appointed by the agent to act for the principal in the business of agency with the consent of the principal.

Section 194 enacts, "where an agent holding an express or implied authority to name another person to act for the principal, names another person accordingly, he is not a sub-agent, but a substituted agent for the principal"