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TMI Blog1949 (8) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... nst respondents 2 and 3 and in execution thereof put to sale their houses and purchased them at the execution sale on 7-4-1931. The firm was dissolved some time between the years 1932 and 1933. One Dayabhai Ranchoddas, who held a general power of attorney, sold the houses in suit to the Plaintiff-respondent 1 by a sale-deed dated 2-5-1934. 3. According to respondent 1, respondents 4 and 5, after they purchased the houses, obtained possession and let them out to respondent 6. After the sale in his favour he asked the said respondent 6 to deliver possession of the houses to him but he stated that he had let them out to respondents 2 and 3, that they were not paying the rent of the houses and that respondent 1 should claim the ren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is no propriety in examining the second and the third points in the argument advanced on behalf of the appellant. 7. As regards the first point, the admitted position is that the firm had in fact been dissolved on the date of sale. The question is, what was the effect of this dissolution on the authority of Dayabhai under the general power-of-attorney which the partners of the firm had executed in his favour prior to dissolution? 8. The lower appellate Court has dealt with the point in para. 10 of the judgment. In its opinion the dissolution of a firm does not affect the authority of the agent of that firm. The view is based upon the fact that Section 201, Contract Act, which deals with the question of the termina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Edn.) it has been held that as a contract of agency is generally of a personal character it is determined by a change in the composition of a firm. The principle underlying these decisions is applicable to cases governed by the Indian Contract Act and is not peculiar to the law of England as, apparently, the lower appellate Court seems to think. 10. It is of course true, as has been held by the lower appellate Court, that in so far as third parties are concerned the termination of a contract of agency will take effect only from the time the third party obtained knowledge of it. That is clear from Section 208, Contract Act as well as the decision in Dasarath v. Brojo Mohan 18 Cri.L.J. 621 : (22 I.C. 90). 11. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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