Agency and Partnerships Flashcards
types of business organizations
1) sole proprietorship
2) partnership
3) corporation
types of partnerships
1) general partnership
2) limited partnership
3) limited liability partnership
4) limited liability companies
what type of business makes up most business organizations
sole proprietorship
may a principal be held legally responsible for the actions of an agent?
yes
what does the existence of an agency relationship depend upon?
principal’s consent that an agent will act on his behalf within a fiduciary capacity and the agent consents
is an agent liable as a party to a contract if the contracting party knows who the principal is?
no
when the contracting party knows who the principal is
a disclosed principal
is the agent liable if the contract party does NOT know who the principal is?
yes
when the contracting party does NOT know who the principal is
undisclosed principal or partially disclosed-principal
types of agent authority
1) actual
2) apparent
3) inherent
what is actual authority?
when the agent reasonably believes the words of the principal
is actual authority implied or express?
either one
what is apparent authority influenced by?
prior practices and industry customs
is apparent authority implied or express?
either one
what are the elements of ratification?
1) principal must be aware of material facts
2) implicit or explicit
3) not permissible if being used to the detriment of an innocent third party
an agent performing services in the master’s affairs whose physical conduct is controlled or is subject to the right of control by the master
servant
a person who agrees to carry out some task for another but is NOT SUBJECT TO THE OTHER’S PHYSICAL CONTROL
independent contractor
on who’s behalf does the agent-type of independent contractor act upon?
on the principal’s behalf
on who’s behalf does the non-agent type of independent contract act upon?
his/her own behalf 1
what type of relationships = agency relationships?
1) master & servant
2) employer & employee
3) independent contractor (agent-type)
4) non-servant agent
when is the master liable?
when it’s in the scope of employment
what special cases is the principal liable?
1) retention of control
2) incompetence
3) nuisance/ultra-hazard
4) non-delegability
what type of relationship is a non-agent relationship?
independent contractor (non-agent)
what are the general rules of the scope of employment?
1) was the conduct the kind of conduct that the servant was employed to perform?
2) was the conduct motivated at least in part by a purpose to serve the master?
3) did the conduct occur substantially within the authorized time or space limits of the employment?
