Agency

Question 1

Principal will be liable for the torts committed by its agent if

Answer 1

(1) principal-agent relationship
(2) the tort was committed by the agen within the scope of that relationship

Question 3

Principal-Agent Relationship requires

Answer 3

1. Assent: informal agreement between P, who has capacity and the agent
2. Benefit: Agent’s conduct must be for P’s benefit
3. Control: P must have the right to control A by having the power to suprvise the manner of the agent’s peformance

Question 4

Vicarious liability for an independent contractor’s torts

Answer 4

1. There is no vicarious liability for the independent k’s tort except

• (1) I**nherently dangerous activity
• (2) Estoppel: if you hold out your IC w/ appearance of agency, you’ll be estopped from denying vicarious liability**​

Question 5

Scope of Principal-Agent Relationship Factors

Answer 5

1. Was condcut “of the kind” agent was hired to perform?
2. Did the tort occur “on the job”: Frolic v. Detour

• ​Frolic: a new and independent journey [outside the scope]
• Detour: mere departure from assigned task [w/in the scope]

1. Did agent intend to benefit principal? even if inteded to benefit in part, enough to be inside the scope

Question 6

Scope of P-A relationship

INTENTIONAL TORTS

Answer 6

Intentional torts are generally outside the scope of P-A relationship

EXCEPTIONS (N.A.M)

1. Authorized by P; OR
2. Natural from nature of employment; OR
3. Motivated by desire to serve P

Question 7

Principal is liable for contracts entered into by its agent

Answer 7

only if the principal authorized the agent to enter the contract

Question 8

P contract liablity for A

4 types of Authority

Answer 8

1. Actual Express Authority
2. Actual Implied Authority
3. Apparent authority
4. Ratification

Question 9

Actual Express Authority under K

Answer 9

1. can be oral/private and is narrowly construed

Exception: if K itself must be in writing, then so to the express authority

1. Will be revoked by
   
   1. unilateral act of either P/A OR
   2. death or incapacity of the P
      
      1. EXCEPTION: durable power of attorney: written expression of authority to enter into transaction that includes conspicuous survival language, estate liable.

Question 10

Actual Implied Authority under K

Answer 10

1. Necessity
2. Custom
3. Prior acquiescence by the principal

Question 11

Apparent Authority under K

Answer 11

1. Principal “cloaked” agent with the apperance of authority AND
2. Third party reasonably relies on appearance of authority

Question 12

Ratification

Answer 12

Authority can be granted after the contract has been entered if:

1. Principal has knowledge of all material facts regarding the contract and
2. Principal accepts its benefits

EXCEPTION: Ratification cannot alter terms of the contract.

Question 13

The Rule of laibility on the Contract

1. General Rule
2. Exception

Answer 13

1. The principal is liable on its authorized contracts and therefore as a rule, authorized agents are not liable on their authorized contracts
2. exception: the unidentified or undisclosed principal–if Principal is partially disclosed (only the identitiy of the principal concealed) or undisclosed (fact of principal concealed), authorized agent may nonetheless be liable at the election of the third party

Question 14

Duties Agent owes to Principal

Answer 14

In return for reasonable compensation and reimbursement of expenses, agents owe principals

1. Duty of care
2. Duty to obey instrucitons that are reasonable
3. Duty of loyalty

Question 15

Duty of loyalty

Answer 15

The agent may never do any of the following

1. Self-dealing: agent cannot receive a benefit to the deteriment of the principal
2. Usurping the principal’s opportunity or
3. Secret profits: making a profit at the principal’s expense without disclosure

Question 16

P’s remedies for A’s breach of duty of loyalty

Answer 16

1. recover losses that are caused by the breach
2. disgorge profits made by the A