Agency Flashcards
What is an agency relationship?
An agency relationship is created when one (principal) manifests intent that another (agent) act on his behalf and be subject to his control.
What are the three components of an agency relationship?
- Assent
- Benefit
- Control
What is required for the creation of an agency relationship?
No consideration is required; many states require a writing if it relates to an interest in real property.
Who can be a principal in an agency relationship?
Any individual or entity with capacity to possess rights and incur obligations can be a principal.
Who can be an agent in an agency relationship?
Only minimal capacity is required to be an agent.
What is the standard for terminating an agency relationship?
Either party may unilaterally terminate the agency relationship.
What are some reasons A’s authority may be revoked by P?
- By agreement
- Changed circumstances
- Passage of time
- A’s death
- P’s death or incapacity after notice to A
What is actual authority?
Actual authority arises when P causes A to reasonably believe A has authority to act.
What are the two types of actual authority?
- Express
- Implied
What is apparent authority?
Apparent authority occurs when P causes a third party to reasonably believe the agent has authority to act.
What is ratification in the context of agency?
Ratification occurs when P affirms the contract made on P’s behalf with knowledge of material facts.
What is the difference between a disclosed principal, a partially disclosed principal, and an undisclosed principal?
- Disclosed principal: 3P knows identity
- Partially disclosed principal: 3P knows of agency but not identity
- Undisclosed principal: 3P does not know of agency
What is vicarious liability?
Vicarious liability allows a principal to be held liable for the tortious acts of an agent committed within the scope of employment.
What is the standard for determining if an act is within the scope of employment?
An act is within the scope if it is performed while executing assigned work or acting subject to P’s control.
What is the duty of loyalty owed by the agent?
The duty of loyalty requires the agent to work only for P’s benefit and not to compete or usurp P’s business opportunity.
What is the principal’s duty to the agent?
The principal has a duty to compensate the agent per express or implied agreement.
What are the available remedies for an agent breaching duty?
- Breach of contract
- Injunctive relief
- Tort damages
- Rescission
- Unjust enrichment
What are the available remedies for a principal breaching duty?
- Breach of contract
- Rescission
- Injunctive relief
- Tort damages
- Restitution
- Accounting
- Recovery of secret profits
- Forfeiture of compensation
What is an agency relationship?
An agency relationship is created when one (principal) manifests intent that another (agent) act on his behalf and be subject to his control.
What are the three components of an agency relationship?
- Assent
- Benefit
- Control
What is required for the creation of an agency relationship?
No consideration is required; many states require a writing if it relates to an interest in real property.
Who can be a principal in an agency relationship?
Any individual or entity with capacity to possess rights and incur obligations can be a principal.
Who can be an agent in an agency relationship?
Only minimal capacity is required to be an agent.
What is the standard for terminating an agency relationship?
Either party may unilaterally terminate the agency relationship.
