LEGAL PRINCIPLE: AGENCY LAW – Contracting through Agents – Artificial Legal Entities
PRINCIPLE STATEMENT
An artificial legal entity (such as a university) can only enter into contracts through its agents, namely its officers and servants; this established principle is given statutory efficacy by provisions stipulating that the entity shall have power to enter into contracts and employ and act through agents.
RATIO DECIDENDI (SOURCE)
"The University of Jos being an artificial legal entity can only enter into contracts through its agents, namely its officers and servants. This established principle of law is given statutory efficacy by section 3(1) of the University of Jos Act, 1979 which stipulates that– 'The University shall have power to enter into contracts… and employ and act through agents'."
EXPLANATION / SCOPE
Artificial legal entities (corporations, statutory bodies, universities) lack physical existence and cannot personally act. They must act through human agents—officers, employees, or appointed representatives. This agency relationship is: (1) legally necessary (entities cannot act otherwise); (2) often statutorily authorized (enabling statutes grant contracting powers exercisable through agents). Contracts made by authorized agents bind the entity. Agency authority may derive from: statute, articles/charter, board resolutions, or employment positions. Third parties dealing with entities must ensure: the agent has actual or apparent authority, and they’re acting within scope. This principle enables entities to function commercially while raising issues about: authority verification, ultra vires acts, and identifying which individuals can bind the entity. It reflects the fundamental reality that legal persons require human agency