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Contract of Agency
An agent is a person employed to do any act for another person or to represent another person in dealings with some third person.

The person for whom such act is done (or who is represented )is called the principal .
When banks collect various financial instruments for their customers, this law would come into force.

Meaning of Agency: the person should be authorized to do an act for a person in such a manner , as to bind that person, i.e to make him answerable for such acts done on his behalf. the agent creates contractual relations between two separate persons when he enters into a contract on behalf of one of the parties.

An agent cannot employ another to perform acts which he has undertaken to perform personally. A sub agent may be employed if the custom of trade or the nature or agency so requires . A sub agent is a person employed by and acting under the control of the original agent.
The agent is responsible to the principal for the acts of the sub agent.

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