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NY Agency and Partnership > Agency > Flashcards

Agency Flashcards

0
Q

General Agents

A

authority to conduct a series of transactions

involving continuity of service

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1
Q

Agency in General

A

fiduciary relationship arising when principal manifests assent to another, the agent,
agent acts on the principals behalf
subject to the principals control,
agent manifests assent or otherwise consents to act.

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2
Q

Special Agents

A

Authorized to conduct one transaction or
a particularized series of transactions
do NOT involve a continuity of service

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3
Q

Gratuitous Agent

A

performs duties of an agent without compensation.

While not compensated, will have remedy for restitution for reasonable value of services rendered

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4
Q

Creation and elements of Agency Relationships (3)

A

principal grants authority to agent to act for him
Requires:
1. both parties specifically assent
2. Agent agrees to act for principal; and
3. Agent acts under control of principal

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5
Q

Employer

A

principal employs agent to perform a service in his affairs

Controls physical conduct in performance of the service

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6
Q

Employee

A

agent of employer hired to perform service in his affairs.

conduct is subject to the right of control of the master

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7
Q

Independent Contractor

A

person contracted to do something for another
not controlled by the other
or subject to the others right to control
with respect to physical conduct in the performance of the undertaking.

may be an agent if he is an employee.

An agent who is not a servant is an independent contractor when he contracts to act on the account of the principal

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8
Q

Duties of Principal to Agent

A
  1. Compensate for services - reasonable value
  2. Reimburse reasonable expenses incurred in scope of agency
  3. Indemnify for liability resulting from good faith performance of duties
  4. Cooperate in performance of agents duties
  5. Exercise due care toward agent
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9
Q

Factors determining whether an independent contractor is a servant (employee) or an independent contractor. (9)

A
  1. control over performance of work.
  2. distinct occupation or business?
  3. work customarily done under supervision.
  4. Skill required in agents occupation
  5. who supplies tools+place of performance
  6. Length of time engaged by principal
  7. paid by the job or the hour
  8. intent to create employment relationship.
  9. the principal is a business.
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10
Q

Agents Remedies for a Principals Breach

A

remedies available for breach of contract

Agent retains a lien on a principals property that he has lawful possession, but more than mere custody.

Can set off money owed against monies collected for principal

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11
Q

Principals Defenses in the event of a Breach

A
  1. Statute of Frauds
  2. Illegality
  3. Disobedience
  4. Contributory Negligence (in defense of a tort claim)
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12
Q

Agents Duty of Care to Principal

A
  1. Perform contract and render services with reasonable care.
  2. Obey Principal in all reasonable directions
  3. act with care, competence, and diligence normally exercised by agents in similar circumstances - agents possessing higher skill level to exercise that skill level.
  4. Indemnify principal for losses caused by wrongful behavior or failure to act with reasonable care.
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13
Q

Agents Duty of Loyalty to Principal

A
  1. act as a fiduciary of principal
  2. account for money received for principal
  3. keep principals assets separate from his own.
  4. disclose relevant facts to a transaction he reasonably believes the principal might want to know.
  5. prefer interests of principal to his own or others in acting for the principal.
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14
Q

Self Dealing

A

Agent who acts for his own benefit instead of the principal.

no use of confidential information to principals detriment
even if not obtained through agency.

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15
Q

Noncompete Agreements

A

Must rest on a protectable interest
reasonable in time and
geographic scope to be enforceable.

courts sever nonenforceable provisions from enforceable ones or reduce the area or time covered by the agreement

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16
Q

Dual Agency Role

A

Agent acting for more than one principal in negotiations
transaction is voidable by either principal
unless both are fully informed and consent.

Agents may not compete with principal or
sell his property to principal without disclosure of the interest.

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17
Q

Principals Remedies for Agents Breach

Compensated v. Uncompensated Agent

A

Compensated agents are liable for damages resulting from breach of duty of care - ie negligence - or breach of duty of loyalty - self dealing.

Uncompensated Agents cannot be held liable in general.

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18
Q

Remedies for Principal for Agents Breach

Transactions resulting from breach of fiduciary duty by agent

A

transaction is voidable by the principal

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19
Q

Agents Breach of Loyalty to Principal - Appropriate Remedies

A

Disgorgement of profits made from disloyalty

Agent liable for profits of 3rd parties even if agent didn’t receive profits.
Principal need not have suffered loss.

Punitive damages available if malice or bad faith.

Intentional breach of fiduciary duty,
Principal can withhold compensation.

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20
Q

Types of Authority of Agents - List

A

Actual - includes express and implied

Apparent

21
Q

Actual Authority of an Agent

A

manifestation of principal to agent
Agent act for benefit or principal in a particular way.

Principal agrees to be bound by the actions of the agent.

actual authority exists to take actions designated
implied authority for acts necessary or incidental to objectives
as agent reasonably understands them.

22
Q

Express Authority of an Agent

A

principal directly requests agent to act on a specific matter.

principal consents to actions incidental to carrying out authority

Consent need not be written and is demonstrated by completing task

23
Q

Equal Dignity Rule

A

If an agent enters into a contract that requires a writing to comply with the Statute of Frauds, the grant of authority must be in writing.

land, contracts lasting more than one year, goods over $500

24
Q

Implied Authority of an Agent

A

Anything necessary to accomplish the express request or
what agent believes principal wants done

based on agents reasonable understanding of the express request.

25
Q

Apparent Authority of an Agent

A 
principals representations to a 3rd party.
leads 3rd party to believe an 
actor has authority to act as agent 
and belief is reasonable and traceable 
to a manifestation of the principal.
26
Q

Estoppel to Deny Existence of Agency Relationship

A

Principal may deny agency relationship if there is a

lack of manifestation by the principal that agent holds authority to complete the transaction.

28
Q

Agents Liability to 3rd Parties

A

Disclosed Principal - Agent not liable without additional actions.

partially disclosed - agent presumed party to contract.

unknown - agent assumed to contract on own behalf.

29
Q

Respondeat Superior

A

Strict Liability doctrine

vicarious liability on principal for tort actions of agent committed in the course of agency relationship

agent must be employee or servant

Both jointly and severally liable.

Employers are liable for harm caused employee while
acting within the scope of his employment.

30
Q

Test for Scope of Employment

A

assigned task in
conduct subject to employers control.

Acts not in scope if
not intended employee to serve employers purpose

31
Q

Frolic and Detour

A

Detour - insubstantial deviation- in scope .

Frolic - substantial deviation - outside scope .

32
Q

Respondeat Superior - Independent Contractors

When are Principles held liable for independent contractors

A
  1. inherently dangerous activities
  2. nondelegable duty; and
  3. negligent selection of contractor

General Rule: Principals are not generally liable for torts of independent contractors

33
Q

Tort Liability - Intentional Torts

A

Employer is not liable for intentional torts of employees

unless occurred attempting to serve interest of employer

34
Q

Delegation of Agents Duties

A

Authority involves agent HIS judgement,
responsibility cannot be delegated

UNLESS - emergency or explicit agreement .

35
Q

Ratification

A

retroactive authority for unauthorized acts.

  • principal could have authorized at the time
  • knows all material facts, including agents acting without authorization
  • principal in existence with capacity to enter agreement.
  • can be express or implied
36
Q

Implied Ratification

A

principal accepts benefits of unauthorized contracts

36
Q

Partial Ratification

A

ratification of any part of the contract, ratifies the whole.

37
Q

Where Ratification is NOT effective

A
  1. misrepresentation or other conduct that void the contract
  2. Where principal ratifies to avoid a loss
  3. diminishes rights of persons acquired in the subject matter of transaction, but not parties to the transaction,
39
Q

Conditions necessary for Ratification to be Effective (5)

A
  1. Act otherwise valid when performed.
  2. Principal in existence and competent to ratify.
  3. performed on behalf of the principal
  4. Ratified with formalities required to give initial authorization and
    required by the original act.
  5. know all material facts concerning transaction at ratification including misrepresentation of agent.
39
Q

Automatic Termination of the Agency

A

Death or incapacity

agent or principal

40
Q

General Rule of Agent Liability to 3rd party

A

not bound personally on transactions when acting for principal
within the scope of the agency relationship

41
Q

Automatic Termination of the Agency

A

Death or incapacity
agent or principal

immediately terminates agency even if they are unaware

42
Q

Types of Principals - List

A

Disclosed - 3rd party knows agency relationship and id of principal

Partially Disclosed - knows agency but not principal

Undisclosed - unaware of agency or principal

43
Q

Factors distinguishing types of principals

A

Does the 3rd party know of the existence of the agency?

Does the 3rd party know the identity of the Principal

44
Q

Auctioneer

A

Special Sales Agent

authority to sell goods within auctions terms

45
Q

Subagent

A

hired by agent and is an agent of the agent.

if principal authorized appointment of subagents, subagent is agent of both agent and principal and principal is liable for actions of subagent

47
Q

Principals Remedies for Agents Breach

A

Breach of Loyalty - no loss needed for recovery
disgorge profits of disloyal agent
punitive damages with malice or bad faith - rare

47
Q

Employees who compete with former employer

A

may compete with former employer when employment ends

may not solicit customers or key employees.

48
Q

Ex employee use of skills learned on the job and solicitation of employers customers

A

may use skills learned on the job
may solicit former customers
may not reveal confidential information.

49
Q

3rd party challenge to estoppel claim

A

justifiable inducement under the circumstances because:

  1. Principal Intentionally or Carelessly caused belief
  2. Principal did not take steps to notify them of the facts having notice of belief and that this belief may induce others to change positions
51
Q

Tort committed traveling to and from work

A

outside scope
unless employer provided vehicle and exercised control over how employee uses it
to respond to needs of employers enterprise

NY Agency and Partnership (4 decks)

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