Agency Flashcards
What is privity of contract
An agent entering into a contract establishes privity of contract. - The contract is enfoceable both by the principal and the third party as if the contract had been formed between them initially
How can an agency agreement be created by consent
consent may be express or implied
What is express consent
Where the principle appoints the agent this can be in writing or oral
Land in writing
If an agent is given power of attorney how must this be created
in deed
What is implied agreement
Implied through conduct or relationship
What is agency by estoppel
apparent or ostensible
Where the principal by his word or conduct hold out another as having the authority
What circustances can estoppel arise / what is important
When the principal has failed to notify the third party that the agents authority has been terminated
Where the principal allows the agent to appear to have more authority than he actually does
Important it is the principal actions not the agents
When does agency arising from necessity take place (4)
1) there is an emergency situation
2) not possible to contact the principal
3) the agent is acting in good faith
4) not a stranger
What is agency ratification
If an agent acts beyond their authority or someone with no authority acts for the principal, the principal has no liability unless they ratifies the contract
What happens when the principal ratifies the contract
1) they become liable from the date the contract was actually made
2) agent is relieved from liability
3) no authority is given for future acts
Under what circustances can a contract be ratified
1) The principal exists at the time the contract was made (unincorporated company)
2) principal had the legal capactity
3) agent named and identified the principal
4) principal is made aware of all the terms of the contract
What are the duties of the agent
Acts in goof faith
Principal instruction
Excute contract fair & proper
What are the duties of the principal
notice of termination
compensation for temination
provide all information
What are the duties of the agent by law
COPS CAP
Conflict of interest Obey - resonable legal Performance Skill- resonable Confidential Accountability - no bribes or could be dismissed amount refunded Personal performance
What are the duties of the principal by law
Indemnity
Remuneration - resonable express or inferred
Lien - right to retain property before payment
