Agency and Pship Flashcards
1
Q
How is an agency relationship created?
A
(i) when one person (the principal) manifests an intent that another person (the agent) act on his behalf and (ii) both parties consent to the agreement. A principal is contractually bound to the acts of the agent if the agent acted with actual or apparent authority.
2
Q
Actual Authority
A
Actual authority is authority that the agent reasonably thinks he possesses based on the principal’s dealings with him. Actual authority can be express (contained in the K between the parties) or implied from the actions of the principal.
3
Q
Apparent Authority
A
Apparent authority arises when the principal “holds out” the agent as having certain authority, causing third parties to reasonably believe the agent has such authority.
