Agency Flashcards
Who are the actors in an agency relationship?
Principal and an agent
What is an agent?
Agent does things on behalf of the principal.
What is a principal?
Directs agents acts
Three Components of an Agency Relationship
- Asset: Requires both parties both manifest asset aka agree to work with one another.
- Benefit: Agent agrees to work for the principal’s benefit.
- Control: Agent agrees to work subject to the control of the principal
Is there a requirement of consideration to create an agency relationship?
No
Who can be a principal?
Any person that has legal capacity can be a principal.
Excludes a minors and anyone incapacitated by illness or intoxication.
Who can be an agent?
Any person or entity who has minimal capacity.
A minor may serve as an agent.
To have minimal capacity, an agent must be able to:
Assent to the agency relationship
Perform the tasks on behalf f the principal and
Be subject to the principal’s control.
Contract Liability
When is a principal liable for K that an agent enters on behalf of the principal?
Bound when:
1. Principal authorized the agent to enter into the K
2. The agent acted w/ legal authority
Four types of legal authority
- Actual express authority
- Actual implied authority
- Apparent authority
- Ratification
Actual Express Authority
- Use of words, written or spoken.
- Requisite Intent
1. Subjective Intent: The agent must believe that he doing what the principal wants him to do.
2. Objective Intent: The belief must be objectively reasonable.
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Termination by Death
Actual express authority terminates when the agent has actual knowledge of the principal’s death.
Actual express authority terminates immediately upon the death of the agent.
Actual Implied Authority
A principal creates actual implied authority by using words, written or spoken, OR OTHER CONDUCT to convey authroity the principal’s objective.
The agent has actual implied authority to act within the accepted business custom or general trade custom.
Apparent Authority
Between pirinciapl and third-party
Created by words, written or spoken, that cause the third-party to reasonably believe that principal wants to have acts doe on the principal’s behalf by the gent.
Ratisfication
No pre-act communication to consider.
Requirements:
P has knowledge of the material terms of the K
P accepts the K’s benefits.
Three types of princiapls
Principals can be disclosed, partially disclosed, and undisclosed.
Disclosed Prinipals
Third party knows:
Agent is acting on behalf of a princiapl
P’s identity.
P is partially disclosed
Knows working on behalf of a P, but not the identity.
Undisclosed P
Knows either A’s status nor P’s identity.
Vicarious Liability
A principal may be liable for his acts of his agent.
Requirements:
1. The P has sufficient control over the A’s conduct such that the agency relationship employer-employee
2. The tort committed by the A was committed while the A was acting within the scope of his employment.
Sufficient control
A P wrote controls or has the right to control, the physicla conduct of the agent’s performance of work is in the higher category of employer-employee status.
Does a princial have vicarious liability for torts committed by an indepedne nt contractor
No.
Exceptions:
Task is inherently dangerous
P was neg in hiring the independent contractor
P retains cotnrol over certain tasks and tort occurs within these tasks.
Three questions to determine scope of employment
- Did the A intend to benefit the P
- Was the A’s conduct of the kind that A was hired to perform?
- Did the tort occur on the job.
What is frolic?
A significant deviation from an assigned path; outside scope of employment.
What is detour?
De minims deviation from an assigned path, within scope of employment.
Intentional Torts
Outside the scope of employment.
THere would not be liability for the principals.
What are the exceptions that a P may be held vicariously liable for intentional torts
- Conduct occurred within time and space limits of employment
- A was motivated in some part to benefit the P.
- The act is of a kind that the A was hired to perform.
