SECRET OF PROFIT UNDER THE LAW OF AGENCY1Once an agent received a secret profit, the law presumes that he has been affected by thepayment to the detriment of his principal. Moreover, this does not have the necessity toprove dishonest action or improper use of position of the agent. If the principle knowsabout the extra profit and agree to it, then only the agent is entitled to keep the profit.Therefore, the profit is no longer as a secret. Hence, if the profits are secret, then theprinciple can take action against the agents.The principal may sue the agent and the third party giving the bribe for damages for anyloss he may have sustained through entering into the contract. s in the case of Mahesanv Malaysian Government Officers co-operative Housing Society Ltd, the appellant wasa director and secretary of the respondent co!operative society.In the section "#$, if an agent deals on his own account in the business of the agency,without first obtaining the consent of his principal and ac%uiring him with all materialcircumstances which have come to his own knowledge on the sub&ect, the principal mayrepudiate the transaction. nother section involve is "#', if an agent without theknowledge of his principle which he or she had deals in the business of the agency on hisown account instead of on account of his principle. (hereby, the principle is entitled toclaim from the agent any benefit which may have resulted to him from the transaction.In the fact of the case, he brought land at the price of )'**,+++ from the vendor who hadearlier paid )*,#,+++ for it. The appellant knew of this act. However, he failed to informthe society. The society discovered the fact only after the sale was done and discoveredthe appellant had received )"--,+++ as a secret commission from the vendor. s a result,the .rivy /ouncil held that the respondent could recover either bribe or the amount theactual loss suffered by it as a conse%uence of entering into contract.The principal has the right to recover to bribe or secret profit not only to the extent wherein a transaction an agents sells at a price higher than was set by him. In the case ofTan1 Secret proft can defned as a bribe retrieved from 5th August, 2015 from http://www.awteacher.net/free!aw!essa"s/contract!aw/secret!proft!can!be!defned!as!a!bribe!aw!essa".phpKiong Hwa v Andrew SH !hong" -the defendant was the managing director of houseagency company. The plaintiff has brought a flat from that company. The plaintiff laterauthori0ed the defendant as his agent to seek the flat for )*,,+++. However, the defendantsold the flat for higher price in ),*,+++. The difference of )'.+++ was credited to thecompany. In the principle of law, the court held that the plaintiff was entitled to recover )',+++ from the defendant as the defendant has breached his duty as agent.sinthecaseof theAndrews v#amsayand!o, wheretheprincipal successfullyrecovered both the commission paid to the agent plus the secret commission received byhis agent from a third party. The plaintiff directed the defendant to sell the property andagreed to pay him commission of ,+ pounds. The defendant received "++ pounds from apurchaser as deposit for the property. The defendant paid ,+ pounds to the plaintiff andkept the other ,+ pounds in payment of his commission with the plaintiff1s knowledge.However, the plaintiff learnt that the defendant had also received another -+ pounds ascommissions from the purchaser. He sued his agent to recover this -+ pounds and also the,+poundshehadpaidthedefendant initially.(hereby,thecourt heldthat hecouldrecover both of them.2 #aw of agenc" $business aw% retrieved from 5th August, 2015 fromhttp://&uamiruaiman.bogspot.com/201'/0(/aw!of!agenc"!business!aw.htm