Chapter X - Agency
Section 189
Section 189: Authority in an emergency
In an emergency an agent may take ordinarily prudent protective action to prevent loss to the principal.
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This article is for general information. Refer to the Indian Contract Act, 1872 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
An agent has authority, in an emergency, to do all such acts for the purpose of protecting his principal from loss as would be done by a person of ordinary prudence, in his own case, under similar circumstances.
Illustrations
(a) An agent for sale may have goods repaired if it be necessary.
(b) A consigns provisions to B at Calcutta, with directions to send them immediately to C, at Cuttack. B may sell the provisions at Calcutta, if they will not bear the journey to Cuttack without spoiling.
Rule and business relevance
The benchmark is what a person of ordinary prudence would do in a comparable situation in that person’s own case. The illustrations address needed repairs and sale of perishable provisions unable to survive onward transit.
Limits and related provisions
Urgency is not an unlimited discretion to pursue unrelated transactions. Establish the emergency, protective purpose and proportionality of the action.
Hypothetical business example
Hypothetical example: Perishable goods cannot complete the instructed journey without spoiling. The agent considers a prudent protective sale at the present location.
Practical decision flow
Record the emergency and likely loss.
Compare available protective options with ordinary prudence.
Preserve evidence of the action and communication with the principal.
Check the applicable legal framework
This guide explains the central provision. Applicable State amendments, the agreement, transaction date and other governing laws can affect its application. Check the current legal framework before relying on it for a commercial decision.
Practical checklist
Do
- Record the emergency and likely loss.
- Compare available protective options with ordinary prudence.
- Preserve evidence of the action and communication with the principal.
Avoid
- Urgency is not an unlimited discretion to pursue unrelated transactions. Establish the emergency, protective purpose and proportionality of the action.
Glossary
- Emergency authority
- Authority for the specified prudent loss-protection acts.
- Protective purpose
- Preventing loss to the principal in the emergency.
Frequently asked questions
Can an emergency justify every departure from instructions?
No. The action must meet the statutory purpose and prudence standard.
Can perishable goods justify protective sale?
The second illustration addresses that situation.
Whose interests must be protected?
The principal’s interests.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026