then the principal incurs debts such that his debts exceed his assets, and we place him under interdiction. May the agent sell the house?
The answer is no: the agency is terminated, because the principal is now unable to sell his own house himself. If the original party has no authority to sell, then the derivative party is even less entitled to do so.
Thus, interdiction due to insolvency is subject to further detail, whereas interdiction due to incompetence is not; it invalidates the agency whether the agent or the principal is placed under interdiction.
Whoever is appointed to sell or purchase may not sell to, or purchase from, himself or his child; nor may he sell for merchandise, on credit, or in a currency other than that of the land. …
His statement, “Whoever is appointed to sell or purchase may not sell to, or purchase from, himself or his child”: if he is appointed to sell, he may not sell to himself, his child, his father, or anyone whose testimony in his favor would not be accepted, because he is open to suspicion in such cases. Moreover, if he wished to sell it to a particular person, he could simply say, “Buy this from me,” and would have no need to appoint him as an agent.
For example, I appoint someone to sell a house, saying, “I appoint you to sell my house,” and he sells it to his son. The sale is invalid because he is open to suspicion. If his testimony concerning property is not accepted in favor of his son due to this suspicion, then likewise, when he sells to his son that which he was appointed to sell, he is open to suspicion.
If the agent who sold to his son is trustworthy, upright, and reputable, we say: even so. This is in order to close the door to such dealings, lest someone say, “Why did you validate so-and-so’s sale to his son but not validate another person’s sale?” Therefore, we close the door: he may not sell to any ascendant, such as his father or grandfather, nor to any descendant, such as a son’s child or a daughter’s child, because he is open to suspicion.
The matter is easy to resolve: he should seek the principal’s permission, saying, “My son wants the house; do you permit me to sell it to him?” If he says yes, the problem is resolved. Some scholars have excluded two cases from this ruling: