Agency

Question 1

Agency creation ∑3

Answer 1

(a) Assent–manifestation of assent by both parties to work together;
(b) Benefit–agent agrees to work for P’s benefit;
(c) Control–agent agrees to work subject to P’s control.

Consideration is not required

Question 2

Principal

Answer 2

Any person/entity with legal capacity © unincorporated assc

Question 3

Agent

Answer 3

Any person/entity with minimal capacity to assent, perform tasks for P’s benefit and be subject to P’s control

Question 4

Termination of agency relationship:

Answer 4

unilateral by either party

Question 5

Principal liability under a contract by agent

Answer 5

P is liable for K that A entered on P’s behalf when A has the power to bind P or P ratifies the K.

Question 6

Agent has power to bind principal when

Answer 6

A has actual authority, apparent authority, or P is estopped

Question 7

Actual express authority: creation

Answer 7

created when P uses words to convey authority to A.

Intent: A must honestly and reasonably believe that he’s doing what P wants.

Question 8

Actual express authority: termination

Answer 8

P’s death—when A has actual knowledge;

A’s death—immediate

Question 9

Actual implied authority: creation

Answer 9

created when P causes A’s reasonable belief that A had authority

Question 10

Actual implied authority: scope

Answer 10

Absent express instructions, A can act within the accepted business custom or trade usage

Question 11

Apparent authority: creation

Answer 11

created when P’s manifestations cause 3rd party’s reasonable belief that A has the authority.

(If no manifestations, no apparent authority! Failure to act doesn’t count!)

Question 12

Apparent authority for partially disclosed P

Answer 12

Partially disclosed P: P liable if 3rd party knows A is acting on P’s behalf

Question 13

Apparent authority for undisclosed P

Answer 13

No apparent authority if 3rd party doesn’t know (a) agency status and (b) P identity

Question 14

Apparent authority: termination

Answer 14

P tells 3rd party authority is revoked.

Question 15

Authority by estoppel

Answer 15

P can’t deny authority if

(a) 3rd party reasonably believed K was for P and
(b) P caused the belief or failed to take reasonable steps to notify 3rd party of lack of authority

Question 16

Estoppel of undisclosed principal

Answer 16

(a) A induced 3rd party to change position; and

(b) P knew A conduct might induce 3rd parties and failed to notify.

Question 17

Estoppel of undisclosed principal: limiting instructions

Answer 17

Undisclosed P cannot rely on limiting instructions if it gives less authority than what a 3rd party would reasonably believe A to have if P had been disclosed.

Question 18

Principal liability upon ratification

Answer 18

Even if A had no power to bind, P is bound if P expressly or impliedly affirms K

Question 19

Principal’s ratification elements

Answer 19

Ratification requires

(a) P and 3rd p had legal capacity to contract;
(b) P has knowledge of the material terms of K
(c) P ratifies entire K (accepted K benefits);
(d) P ratifies before 3rd party withdraws from K

Question 20

Respondeat superior

Answer 20

P is liable for A’s tortious acts if ∑

(a) P had sufficient control over A (e.g. employer-employee) and
(b) A was acting within the scope of employment.

Question 21

Principal has sufficient control over agent when

Answer 21

P has right to control the manner and means of the work–when A is an employee.

Independent contractor: P does not control or have the right to control the manner and means of the work

Question 22

Independent contractor—factors to analyze

Answer 22

High level of independence, free to work for others, fixed fee, own tools

P does not control or have the right to control the manner and means of the work

Question 23

Principal liability for torts by independent contractor

Answer 23

P is not liable for torts by IC unless

(1) inherently dangerous task;
(2) P was negligent in hiring IC; or
(3) P retained control over certain tasks and tort occurs within those tasks

Question 24

Scope of employment—factors to analyze

Answer 24

(1) A intended to benefit P;
(2) A was hired to perform the conduct;
(3) Tort occurred “on the job” (frolic or detour).

Question 25

Principal liability for intentional torts by agents

Answer 25

Intentional torts generally presumed to be outside the scope.

P not liable unless ∑3

(a) A was motivated in some part to benefit P;
(b) A was hired to perform the kind of act;
(c) tort occurred within the general scope of employment

Question 26

Agent’s fiduciary duties—3 duties:

Answer 26

(1) Duty to exercise reasonable care;
(2) Duty to obey reasonable instructions;
(3) Duty of loyalty

Question 27

A’s duty of loyalty—3 components:

Answer 27

(1) A cannot compete in competing business;
(2) A cannot usurp a business opportunity (must disclose to P),
(3) A cannot seek/accept benefits from 3rd p during agency relation without P’s consent