Creating Agency by Necessity

The doctrine of necessitous intervention by someone who is in a legal relationship with the defendant lie in the principle of agency of necessity, where an agent went beyond his or her authority by intervening on behalf of the principal in an emergency. Because of the circumstances of necessity, particularly the impracticability of the agent communicating with the principal, the courts were prepared to treat the agent as though he or she had the necessary authority to do what was reasonably necessary to save the principal's property. If an agency of necessity was established, the agent would be reimbursed for the expense incurred in rescuing the principal's property.

An agency of necessity may be created if the following three conditions are met:

a) It is impossible for the agent to get the principal’s instruction.

b) The agent’s action is necessary, in the circumstances, in order to prevent loss to the principal to prevent them from rotting.

c) The agent must have acted in good faith.

In an urgent situation, an agent has authority to act in the best interest for the purpose of protecting his principal from losses.

In the case of Great Northern Railway Co v Swaffield,  Swaffield arranged for a horse to be transported to himself care of a railway station owned by the plaintiffs. The horse arrived at the station however Swaffield was not there to meet it. As the plaintiffs could not contact Swaffield before nightfall and had no facilities to accommodate the horse, they sent it to a livery stable.

The legal issue was whether the plaintiffs could  recover from Swaffield the amount they paid the stable for the horse's accommodation? It was held that the plaintiffs had acted reasonably in placing the horse in the stable and were entitled to recover the expenses (which were reasonable) from Swaffield.

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