Direct representation: introduction

Not only the contract in favour of a third party but also the modern law of agency have been developed, in the civil-law systems, largely in opposition to the situation in Roman law.

Again, it was the "alten stipulari nemo potest" principle which stood in the way; again, however, matters were complicated by the fact that the Corpus Juris Civilis did not really present a very clear and consistent picture. Again, it was Hugo Grotius who had a major impact on the development; m particular', he advanced the legal analysis by distinguishing for the first time between contracts in favour of a third party and agency: "Solent et controversiae incidere de acceptatione pro altero facta: in quibus distinguendum est inter promiss ionem mihi factam de re danda alt er i, et inter promissionem in ipsius nomen collatam cui res danda est.""⁵ This distinction is based on Grotius' general emphasis on the will of the contracting parties, and it has remained fundamental ever since.^{[226] [227]} It was developed as a consequence of the rejection of the "alteri stipulari nemo potest" principle. As long as this principle was applied, it was seen to refer to all situations in which an independent third party acquired a right under a contract which had been concluded between two other parties. This is exactly what (genuine) contracts in favour of third parties and agency have in common, and therefore it had hardly been necessary thus far to differentiate cases which were prohibited anyway. Agency, as we see it today, refers to a situation where one person (the agent), authorized by a third party (the principal), concludes a transaction on behalf of the latter with another person, with the result that such transaction will take effect between the principal and this other person.^[228] Thus, the main difference from what we call a contract in favour of a third party lies in the fact that in the one case the principal in every respect becomes party to the contract that has been concluded by the agent; the agent is merely acting as a conduit pipe and has no concern with the effects of the transaction. In the other case, the third party acquires only the right to claim performance.

He does not become a party to the contract which is concluded, and becomes effective, between promisor and promisee. Thus, the imposition of a duty to perform is conceivable only in the case of agency; a contract not only for the benefit of, but casting a burden on a third party is not, and has never been, admissible.^{[229] [230] [231] [232] [233]} If one looks at the will of the parties concerned, one can say that the agent wants to accept the promise in the name of the principal, whereas the promisee under a contract in favour of a third party wants to act in his own name for the benefit of the third party. For agency, the continental legal systems specify a further requirement: the agent has to act in the name of the principal,^ay and must therefore make it clear to the other party that he is not acting in his own name.⁹⁰ This is the publicity principle'" which, incidentally, had also already been enunciated by Grotius and the other natural lawyers.⁹² In contradistinction, English law recognizes the "undis­closed principal":⁹¹ as long as the agent has authority to act at the time when the contract is made, the principal acquires rights and duties under this contract even if the agent did not reveal the fact that he was acting on behalf of another. Although this has often been regarded as a strange anomaly of English law,^{[234] [235]} the undisclosed principal has managed to creep into one civil-law system, namely the usus hodiernus of Roman-Dutch law.^{[236] [237]} According to the South African Appellate Division, the opportunity to expel the uncouth intruder has unfortu­nately been lost?

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More on the topic Direct representation: introduction:

1. The direct applicability and direct effect of different forms of EU law
2. Representation
3. Representation in litigation
4. The criteria for direct effect
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6. The concept, sketched in the preceding chapter, of the obligatio as being a strictly personal bond between the two parties who had concluded the contract found highly characteristic expression in the fact that Roman law did not recognize contracts in favour of third parties, (direct) agency and the cession of rights.
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