Agency Flashcards
Capacity Requirements for Agency Relationship
Principal: contractual capacity
Agent: minimal capacity
Formalities of Creating an Agency Relationship
1) Capacity
2) Consent
3) Writing **
Not:
Consideration
** Writing (unless under SOF)
Methods of Creating an Agency Relationship
Act of Parties - Agreement - Holding out by principal (apparent authority) - Ratification Operation of Law - Estoppel - Statute
Agent’s Duties
Express duties, fiduciary duties of loyalty, obedience to lawful instructions, and reasonable care
Principal’s Remedies Against Agent
Contract actions, tort actions, actions for secret profits, equitable actions, and withholding of compensation for intentional torts or intentional breach of duties
Principal’s Duties
Duties imposed by contract, reasonable compensation, and reimbursement for expenses
Agent’s Remedies
Contract remedies with a duty to mitigate
Possessory lien for any money due
Actual Authority
Authority that agent reasonably believes he possesses based on principal’s dealings with her
Express: contained in four corners of agreement
Implied: agent’s reasonable belief as result of principal’s actions
Termination of Actual Authority
Lapse of specified or reasonable time The happening of specific event A change in circumstance Agent's breach of fiduciary duty Either party's unilateral termination Operation of law
Irrevocable Agencies
An agency coupled with an interest may not be unilaterally terminated
Apparent Authority
Arises from reasonable belief of third party where principal directly or indirectly holds out another as possessing certain authority
Types of Apparent Authority
When Agent Has No Actual Authority - Imposter - Lingering Apparent Authority (should provide notice) When Agent Exceeds Actual Authority - Prior Act - Position
Inherent Authority
When court wishes to protect third parties
- Respondeat superior
- Conduct similar to that authorized
Ratification
agency relationship is created when “agent” purports to act on behalf of “principal” without authority, but principal later validates the act and becomes bound retroactively
Prerequisites for Ratification
- Principal must know or have reason to know material facts
- Accept the entire transaction
- Have capacity