Agency

Question 1

Agent

Answer 1

A partner is an agent of the partnership for the purpose of its business, and the partnership itself is the principal

partnership is bound on a contract entered into by a partner on the partnership’s behalf if the partner has actual authority to enter into the contract.

Question 2

Actual Authority

Answer 2

• Actual authority can be either express or implied
• key question is whether the partner reasonably believes that he has authority based on manifestations from the partnership.
• If the partner has such a belief, then that partner has actual authority.

Question 3

Personal Liability

Answer 3

• partners are subject to personal liability for partnership obligations, including contracts that the partnership enters into in the course of partnership business.
• vicariously liable on such contracts by virtue of their status as partners
• All partners are liable jointly and severally for all obligations of the partnership, regardless of whether the obligation arises in contract or in tort.
• that a partnership creditor may bring an action against any one or more partners, or against the partnership, in the same or in separate actions

Question 4

Respondeat Superior

Answer 4

-an employer is subject to vicarious liability for a tort committed by an employee acting within the scope of his employment. The employer is liable despite the absence of tortious conduct by the employer.

Question 5

Unauthorized Acts

Answer 5

-partner’s act that is not authorized by the partnership may nevertheless bind the partnership under the principles of apparent authority
-agent has apparent authority when a manifestation of the partnership causes a third party reasonably to believe that the partner has authority
-

Question 6

TBOC and Apparent Authority

Answer 6

recognizes apparent authority in the partnership context by stating that the act of any partner that appears to be for the purpose of carrying on, in the ordinary course, the partnership business (or business of the kind carried on by the partnership) binds the partnership, unless: (1) no authority existed for the partner to act for the partnership in the particular matter; and (2) the third party with whom the partner was dealing knew that the partner had no authority.

Question 7

Agent to Partnership

Answer 7

• Each partner is an agent of the partnership for purposes of its business, but not an agent of the other partners.
• A principal has the right to recover for breach of the agent’s fiduciary obligation.

Question 8

Remedies for Principal (breaks duties)

Answer 8

• A principal may pursue a number of remedies including an injunction
• an individual suing (Danae instead of Lowe corp) is not a principal, so is not entitled to injunction, but the business suing is a principal, so it entitled to injunction