agency and partnership

Question 1

agentcy and partnership

Answer 1

Partnership and agency

1. LL Partners are agents to the business (principal)
   the partners/ agent’s are acting on behalf of the principal when dealing with third parties.
2. All parties create an agency relationship when they Consent to form a agency relationship(express or implied).
3. No writing required to form the agent principal relationship unless interest is property, or will not be completed in 1 year

• Partners can bind the business to contracts with third parties by : Apparent or actual au.
• Inherent - principal is held liable based on the relationship 

• Operation of law: ct created to stop the denial of a agency relationship when a third party relied on it
• Ratification- The agent holds out as having authority for the principal in which he does not but then the other agents ratify the agent act. Basically the agent does an act, the other agents gets knowledge, and the other agents affirms the act express or implied(enjoy the benefits) when should have declined.
• Agent fiduciary duties
  Partners Duty of loyalty and care to obey reasonable instructions and act solely or the benefit of the business with respect to matters within the scope of business .
• A To P
  Unless they have a k that says otherwise, (loyalty, obedience, and care)
  Loyalty- no adverse interest or failure to disclose interest
  Obedience- must obey purpose of business instructions
  Care- handle agency with care, duty to notify p on agency related matters
• P to A
  -Pay reasonable compensation
  -Reimburse other partners/ business for loses and expenses A incurred for P even if in his duties
  -p must cooperate with agent to carry out business functions
• A & P To Tp’s
  -P liable to TP for acts A carry out if:either P had knowledge of A act or if TP had apparent authority, or P was disclosed by A: but the act must have been within the scope of A’s duties
  -Agents personally liable if go beyond scope of au,
• Disclosed P- tp knows of P’s existence, and identity (p liable)
• Partially disclosed- tp knows existence but not identity of P (possibly both p and a)
• Undisclosed- tp knows neither the existence or identity of principal. (Possibly both p and a)
  Possiblily- depends on whether agency exceeds the au only agent liable.
  If tp wins against agent then cant go after P

Remedies to P for A’s breach of duty
1. Contractual - breach of k duties
2. Tort: liability arising from agents neg. Or recklessness
3. accounting= determine missing money or property
4. Withholding of compensation- principal can deny payment