The fish-selling agent suddenly falls ill on the way; how will he make a choice at this critical moment?
[2] Compiled from: Shandong High Court
Case review
[2] Xiao Zhang, a fish farmer, caught 1,000 jin of fish from his pond and planned to sell them at the market. Just as he was about to leave, he received a call from a friend’s family saying there was an urgent matter needing help. So Xiao Zhang entrusted Wang to sell the fish on his behalf at the city market, orally agreeing that after the fish were sold, Xiao Zhang would pay Wang a 5% commission. On the way to the city, Wang suffered severe stomach pain, stopped the car, and went to a roadside hospital, where he was diagnosed with acute appendicitis requiring immediate surgery. Unable to reach Xiao Zhang because his phone was off, Wang, worried that the fish would spoil in the heat, entrusted A to sell them on his behalf at the prevailing market price.
[3] A took the fish to the market, but they were no longer fresh. Selling them at the original price seemed unlikely, and taking them back would result in even greater losses, so A reduced the price by one-quarter and sold all 1,000 jin of fish. After returning, A handed the proceeds to Wang, who deducted 5% as his commission. Wang then gave the money to Xiao Zhang, who, upon discovering the nearly 1,000 yuan loss from the price reduction, refused to pay the 200 yuan commission.
Civil Code of the People's Republic of China
[4] Article 169
[5] If an agent needs to sub-entrust a third party to act as agent, the agent shall obtain the consent or ratification of the principal.
If a sub-agency is consented to or ratified by the principal, the principal may directly instruct the third party in the sub-agency regarding the agency matters, and the agent shall only be liable for the selection of and instructions to the third party.
If a sub-agency is not consented to or ratified by the principal, the agent shall be liable for the acts of the third party in the sub-agency; except where the agent needs to delegate to a third party in an emergency to protect the principal's interests.
[1] The author's perspective
First, in this case, Xiao Zhang entrusted Wang to sell fish on his behalf. Xiao Zhang is the principal, Wang is the agent. Wang, due to a sudden illness, entrusted A to sell the fish, making A a sub-agent. The author reminds that several points need attention regarding sub-agency:
First, the original agency relationship must be lawful and valid. That is, Xiao Zhang's entrustment to Wang must be lawful and valid, which is a necessary prerequisite for the subsequent sub-agency.
Second, generally, sub-agency requires the principal's prior consent or subsequent ratification, but exceptions may exist in emergencies. If the principal does not give prior consent or subsequent ratification to the sub-agent's actions, the sub-agent's agency actions may constitute unauthorized agency, rendering them in a state of pending validity. Only after the principal consents or ratifies does the sub-agency become effective.
Third, the sub-agent's authority remains within the scope of the original agency authority. The sub-agent exercises agency authority within the original scope and is also bound by the scope of the agent's instructions. Sub-agency actions beyond these two scopes constitute unauthorized agency.
Fourth, when a sub-agent performs legal acts in the name of the principal with a third party, the legal consequences are borne by the principal. That is, to protect the principal's interests, the agent selects a sub-agent in their own name to carry out all or part of the acts within the scope of authority, and the legal effects of such agency directly belong to the principal.
In this case, when Wang suddenly fell ill, there were two options: one, as in this case, was to urgently entrust A to sell the fish, making A a sub-agent. The other was for Wang to immediately seek treatment and leave Zhang's fish unattended, resulting in spoilage and decay, which would certainly be the greatest loss for Zhang. Clearly, the first option is more reasonable than the second, but the key issue is that the principal, Zhang, neither gave prior consent nor later ratified A becoming a sub-agent. So who should bear the legal consequences caused by A?
The author believes that Wang's temporary sub-entrustment is valid, and the legal effects of the acts performed by sub-agent A should be borne by the principal, Zhang. There are two reasons: first, in an urgent situation, Wang acted to protect Zhang's interests, preventing Zhang from suffering a total loss. From a good-faith perspective, Wang's actions were reasonable and lawful and should be supported. Second, although sub-agent A's act of selling the fish at a low price caused some loss to Zhang, it did not exceed the scope of authority granted by Zhang to Wang, and pricing according to market conditions aligns with market economy principles. In summary, the 200 yuan compensation promised by Zhang to Wang should also be paid.
