Book1 Chapter03 Title05

GERMAN CIVIL CODE OF 1896

• Based on the English Translation by: Wang, Chung Hui (1907). The German Civil Code, translated and annotated with historical introduction and appendices. London: Stevens and Sons. [available on Archive.org]

BOOK I. General Principles.

Chapter III. Juristic Acts.

Title V. Agency, Power of Agency.

Section 164.

• [I] A declaration of intention which a person makes in the name of a principal within the scope of a delegated authority operates directly both in favour of and as against the principal. It is immaterial whether the declaration is made expressly in the name of the principal, or from the circumstances it appears that the intention was to make it in his name.
• [II] If the intention to act in the name of another does not appear manifest, the absence of intention on the part of the agent to act in his own name is not taken into consideration.
• [III] The provisions of par. 1 apply mutatis mutandis if a declaration of intention required to be made to another is made to his agent.

Section 165.

• The validity of a declaration of intention made by or to an agent is not impaired by the fact that he is limited in disposing.

Section 166.

• [I] In so far as the legal effectiveness of a declaration of intention is vitiated by defective intention, or by knowledge or culpable ignorance of certain circumstances, regard is had to the principal, not to the agent.
• [II] If, when delegated authority (i.e., power of agency) is conferred by juristic act, the agent has acted according to definite instructions of the principal, the latter may not set up the ignorance of the agent with regard to such circumstances as he himself knew. The same applies to circumstances which the principal ought to have known, so far as the obligation to know is equivalent to actual knowledge.

Section 167.

• [I] A power of agency is conferred by declaration to the person who is to exercise the power, or to the third party with whom the business delegated is to be transacted.
• [II] The declaration need not be in the form prescribed for the juristic act to which the power of agency relates.

Section 168.

• The power of agency is terminated according to the legal relation upon which its creation is based. The power of agency is also revocable during the subsistence of the legal relation, unless a contrary intention appears from such relation. The provision of 167, par. 1, applies mutatis mutandis to the declaration of revocation.

Section 169.

• In so far as a terminated power of agency of a mandatory or a managing partner is deemed to continue as provided for in 674, 729, it is not valid in favour of a third party who, at the time when a juristic act is entered into, knows or ought to know of the termination of the power.

Section 170.

• If a power of agency is conferred by declaration to a third party, it remains in force in respect to him until he is notified of its termination by the principal.

Section 171.

• [I] If a person has announced by special communication to a third party or by public notification that he has given a power of agency to another, then the latter by virtue of the notice becomes an authorised agent, in the former case with reference to the said third party, in the latter case with reference to any third party.
• [II] The agency remains in force until the notice is revoked in the same manner as it was given.

Section 172.

• [I] It is equivalent to the special communication of a power of agency by the principal, if he has delivered to the agent a written power of agency and the agent produces it to the third party.
• [II] The agency remains in force until the written power of agency is returned to the principal or declared invalid.

Section 173.

• The provisions of 170, 171, par. 2, and 172, par. 2, do not apply, if the third party knows or ought to know of the termination of the agency at the time when the juristic act is entered into.

Section 174.

• A unilateral juristic act which an agent enters into with another party is ineffective, if the agent does not produce a written power of agency and the other party without delay rejects the juristic act for this reason. The right to reject is barred if the principal had informed him of the agency.

Section 175.

• After the termination of the power the agent shall return the written power of agency to the principal ; he has no right of lien on it.

Section 176.

• [I] The principal may declare the power of agency invalid by a public notification; the declaration of invalidity must be published according to the provisions of the Code of Civil Procedure applicable to the public service of a citation. The declaration of invalidity takes effect upon the expiration of one month after the last insertion in the public journal.
• [II] Both the District Court in whose district the principal is generally subject to jurisdiction and the District Court which would be competent to entertain an action for the restitution of documents without regard to the value of the object in dispute are equally competent to authorise the publication.
• [III] The declaration of invalidity is ineffective if the principal cannot revoke the power of agency.

Section 177.

• [I] If a person enters into a contract in the name of another without authority, the contract is valid in favour of and as against the principal only if he ratifies.
• [II] If the other party demands the principal to declare whether or not he ratifies, the declaration may be made only to him; a ratification or refusal to ratify declared to the agent before the demand is of no effect. The ratification may be declared only before the expiration of two weeks after-receipt of the demand; if it is not declared it is deemed to have been refused.

Section 178.

• Before ratification of the contract the other party is entitled to revoke it, unless he knew of the absence of authority at the time when the contract was entered into. The revocation may also be declared to the agent.

Section 179.

• [I] A person who has entered into a contract as agent is, if he has net given proof of his authority, bound to the other party at his election either to carry out the contract or to compensate him, if the principal refuses to ratify the contract.
• [II] If the agent did not know that he had no authority, he is bound to compensate only for the damage which the other party has sustained by relying upon the authority; not, however, beyond the value of the interest which the other party has in the validity of the contract.
• [III] The agent is not liable, if the other party knew or ought to have known of the absence of authority. The agent is also not liable if he was limited in disposing capacity, unless he had acted with the consent of his statutory agent.

Section 180.

• In the case of a unilateral juristic act agency without authority is not permissible. If, however, the person with whom such a juristic act purported to be entered into has not demurred to the authority claimed by the agent at the time of entering into the juristic act, or if he has agreed that the agent should act without authority, then the provisions relating to contracts apply mutatis mutandis. The same rule applies if a unilateral juristic act be entered into with an unauthorised agent with his assent.

Section 181.

• An agent may not without leave enter into a juristic act in the name of his principal with himself in his own name, or as agent of a third party, unless the juristic act consists exclusively in the fulfilment of an obligation.