Agency general pt 3 Flashcards
Dual Purpose Rule Test
Conduct fo a servent is within the scope of employment, if, but only if:
- it is of a kind he is employed to perform
- it occurs substatially within the authorized time and space limits
- it is actuated, at least in part, by a purpose to serve the master
Conduct of a servent is not within the scope of employment if it is
different in kind from that authorize far beyond the authorized time or space limits, or too little actuated by a purpose to serve the master
Principal intends conduct or consequences
a person is subject to liability for the consequences of anothers conduct which results from his directions as he would be for his own personal conduct if,
with knowledge of the conditions, he intends the conduct, or if he intends its consequences, unless the one directing or the one acting has privlege or immunity not available to the other
A master is subject to liability for the torts of his servents committed while
acting in the scope of their employement
A master is not subject to liability for the torts of his servents actingoutside the scope of their employment, unless:
- the master intended the conduct or the consequences, or
- the master wsa negligent or reckless, or
- the conduct violated a non-delegable duty of the master, or
- the servent purported to act or to speak on behalf of the principal and there was reliance upon apparent authority, or he was aided in accomplishing the tort by the existance of the agency relationship
From the dual purpose rule it follows that the conduct of an employee, although done in part to serve the purposes of the servent or a third person may be
within scope of employment if the employers business actuates the employee to any appreciatable extent
The mere facts that the primary motive of the servent is to benefit himself or a third person does not
cause the act to be outside the scope of employment
detour v. frolic
detour: vicariously liable
frolic: not vicariouslt liable
To be within the scope of employment, conduct must be of the
same general nature as authorized, or incidental to the conduct authorized
In determining whether or not the conduct, although not authorized, is nevertheless so similar to or incidental to the conduct authoritzed as to be within the scope of employment, the following matters of fact are to be considered:
(10)
- whether or not the act is one commonly done by such servents
- the time, placem and purpose of the act
- the previous relations between the master and the servent
- the extent to which the business of the master is apportioned between different servents
- whether or not the act is outside the enterprise of the master or, if within the enterprise, has not been entrusted to any servent
- whether or not the master has reason to expect that such an act will be done
- the similarity in quality of the act done to the act authorized
- whether or not the instumentality by which the harm is done has been furnished by the master to the servent
- the extent of the departure from the normal method of accomplishing an authorized redult, and
- whether or not the act is seriously criminal
Conduct not for purpose of serving master
an act of a servent is not within the scope of employment if it is done with no intention to perform it as part of the incident to a service on account of which he is employed
Conduct actuated by dual purpose
conduct may be in scooe of employment, although done in part to serve the purposes of the servent or of a 3rd person
Principal cannot or does not give required performance
act done or offered to be fone by an undisclosed principal which, if performed by person other then the agent, are not substantialy those which the contract contemplates are not effective as a performance or as a tender of performance of the contract
Principal Disclosed
unless otherwise agreed, a person making or purporting to make contract with another agent for a disclosed principal does not become a party to the contract
Principal partially disclosed
unless otherwise agreed, a person purporting to make a contract by another for a partially disclosed principal is a party to the contract
Principal undisclosed
An agent purporting to act up on his own account, but in fact making a contract on account of an undisclosed principal, is a party to the contract
When an agent with actual or apparent authority makes a contract on behalf of a disclosed principal:
- The princiapl and hte 3rd party are parties to teh contract, and
- the agent is not a party to the contract unless the agent and third party agrees otherwise
When an agent acting with actual or apparent authority makes a contract on behalf of an unidentified principal
- the principal and the third party are parties to the contract, and
- the agent is party to the contract unless the agent and the 3rd party agree otherwise
When an agent acting with actual authority makes a contract on behalf of an undisclosed principal
- unless excluded by the contract, the principal is a party to the contract
- the agent and the 3rd party are parties to the contract
- the principal if a party to the contract, and the 3rd party have the same rights, liabilities, and defense against each other as if the principal made the contract personally
A principal is subject to direct liability to a 3rd party harmed by an agents conduct when
- the agent acts with actual authority or the principal ratifies the agents conduct anda. the agents conduct is tortious and
b. the agents conduct, if that of the principal, would subject to the principal to tort liability or
1. the principal is negligent in selecting, supervising, or otherwise controlling the agent or
2. the principal delegates performance of a duty to use care to protect other persons or their property to an agent who fails to perform the duty
A principal is subject to vicarious liability to a 3rd party harmed by an agents conduct when
- the agent is an employee who commits a tort while acting within the scope of employment, or
- the agent commits a tort when acting with apparent authority in dealing with a 3rd party or purportedly on behalf of the principal
A principal is subject to liablity to a third party harmed by an agents conduct is within the scope of the agents actual authority or ratified by the principal and
- the agents conduct is tortious or
- the agents conduct, if that of the principal would subject the principal to tort liability
The two most significant “scope of employment factors”
- the extent to which the employees motive in commiting the tort was to further the employers interest and
- the extent to which the emplouees tort was forseeable by the employer
An employees criminal misconduct may also be found within the scope of his employment, although the more violent the act,
the less likely that the employee will be found to have acted to further the employers interest or that the employer could have forseen the act.
Principal liability
- Disclosed principal
- partially disclosed/unidentified principal
- undisclosed principal
- Disclosed Principal = Agent is not liable unless
otherwise agreed - Partially Disclosed/Unidentified Principal = Agent
is liable unless otherwise agreed - Undisclosed Principal = Agent is liable
For the level of disclosure of the principal what do we care about?
If they know, not if they should know
Liability as a lawyer on contract for client
Not liable, the third party knows the principals identity
CEO liability for contract entered into by business
Not liabile for contract, although his name is in signature
default rules for disclosure of prinicipal can be ___ if agreed otherwise
changed
Breach of Implied Warranty
“Agent” is subject to liability for damages due to a breach
of an implied warranty of authority for purporting to make
a contract on behalf of the “Principal” if “Agent” did not
have authority unless
- Principal ratifies or is held liable anyway under
estoppel - Warranty is disclaimed
- 3rd Party knew
3rd party liability to the principal
Disclosed Principal or Partially
Disclosed/Unidentified Principal =
3rd
party is bound to Principal if Agent had
authority
3rd party liability to the principal
Undisclosed Principal
3rd Party is bound to Principal if Agent had authority with some some exceptions
Assignment/Delegation of Duty Rules for
Undisclosed Principa
- Can’t substitute Principal for Agent if it substantially changes the performance given to
or obligations of the 3rd party - Can’t require 3rd party to render personal
services to Undisclosed Principal
Recission available for 3rd Party if misrepresentations +
knowledge that 3rd Party wouldn’t deal with Principal
- Silence is not a false representation
- Actual knowledge
- Different price doesn’t mean they wouldn’t deal with
the Principal
3 ways principal is liabile to 3rd party
- Liable if Agent has authority
- Liable if they ratify
- Liable under estoppel
2 ways agent liable to 3rd party
- On the contract - Disclosed, Partially Disclosed (or unidentified) and Undisclosed Analysis
- For breaches of implied warranties and tortious misrepresentations
2 ways 3rd party liability to agent/principal
- 3rd Party not required to deliver performance to Principal if it substantially
changes or is for personal services - Recission rights for misrepresentation with knowledge
Difference
between being a
party and being
a beneficiary
- Beneficiary is not a party but have a vested interest (gets something out of it)
- beneficiaries can be intended v. incidental (intended: if you are on your parents lease, life insurance; incidental from unintended consequences)
An employer is subject to vicarious liability for a tort committed by its employee acting
within the scope of employment.
Agents are always liable for
their own torts
Masters are principals with a
high level of control
(physical conduct).
Servants are agents who are subject to a
high level of
control (physical control) from their principals
ex. dress code, when they work
Independent contractors may or may not be agents but
they are NOT subject to a
high level of control (physical
control) even if they are agents
A master is a principal who employs an agent to
perform service in his affairs
and who controls or has the right to control the physical conduct of the other in the performance of the service.
A servant is an agent employed by a master to
perform service in his affairs
whose physical conduct in the performance of the service is controlled or is subject to the right to control by the master.
An independent contractor is a person who contracts with another to do something for him but who is not
controlled by the other nor subject to the other’s right to control with respect to his physical conduct in the performance of the undertaking. He may or may not be an agent
the fact that the employee is not paid
the fact that
work is performed gratuitously
ex. unpaid internship
does not relieve
a principal of liability.
