Agency

Question 1

What 2 elements are needed for an agency relationship?

Answer 1

1. Consent by both principal and agent.
2. Agent is subject to principals control.

Question 1

When are principals liable for their independent contractors?

Answer 1

1. The duty delegated by the principal is non delegable (eg: inherently dangerous)
2. The independent contractor is held out as an agent and a third party relies.

Question 2

What are the two types of Actual Authority

Answer 2

1. Express - the agent is expressly given authority to act for the principal.
2. Implied - the principals conduct led the agent to believe it has authority.

Question 3

What are the two elements of apparent authority?

Answer 3

1. The person reasonably believes in the agents authority,
   and
2. The principals act or neglect generated the belief.

Question 4

What is inherent agency power? (rarely tested)

Answer 4

when an agent violates their authority but does so:
1. in the prinipcals interests, and
2. is trusted and controlled by the principal.

Question 5

What are the elements of ratification?

Answer 5

The principal is liable even if the agent lacked authority, when:
1. If the principal knew of the material facts and had the capacity to ratify transaction, and;
2. The principal affirms or accepts the benefit of the transaction.

Question 6

When is an agent liable to a third party on a contract?

Answer 6

1. If the principal is disclosed, the agent did not have authority;
2. If the principal is undisclosed, at the third partys election;
3. If the principal is partially disclosed or unidentified, both can be liable.

Question 7

What are the two forms of liability for a principal for torts committed by agent?

Answer 7

1. vicarious liability:
   a. agent was acting scope of employment;
   b. agent made a minor deviation from route;
   c. agent committed an intentional tort, if it was for the principals benefit, authorized by principal, or one that arose naturally from employment;
2. direct liability: principals are directly liable for negligently hiring, firing, or supervising.

Question 8

What are the three duties owed by an agent?

Answer 8

1. duty of care
2. duty to obey instructions
3. Duty of loyalty (not engage in self dealing, taking principals opportunity, profit w/o disclosure)