Agency/Partnership Flashcards
Agency
fiduciary relationship resulting from mutual consent between two parties, where agent acts on behalf of, for the benefit, and subject to the control of the principal
Parties to Agency
Principal: consents for the other to act on their behalf
Agent: consents to act on behalf of the principal
Actual authority
express: Principal authorizes the agent to certain actions through words or conduct
implied: authority to act reasonably necessary to perform the expressed act
Apparent Authority
a matter of appearance on which third parties come to rely based on principal’s words/conduct that agent is authorized to act on their behalf - requires a showing of (1) reasonable belief agent was authorized to act (2) based on principal’s words/conduct
Liability of disclosed principal to 3rd party
full liability - agent is not liable if (1) had authority to act (2) principal was disclosed
liability of unidentified disclosed principal to 3rd party
both principal and agent are liable
liability of undisclosed principal
undisclosed party: third party unaware agent is acting on behalf of anyone - agent is personally liable - principal is liable if (1) agent was acting under actual authority (2) principal ratifies actions
Principal’s liability on agent’s torts
principal vicariously liable for agent’s tort if (1) valid principal-agent relationship exists (2) tort committed within the scope of that relationship
Determining whether agent was acting in scope of agency
(1) tort committed as part of agent’s job duties (2) tort occur during work hours - detour=liable frolic=not liable (3) agent’s conduct intended to benefit principal
Liability for independent contractor
principal generally not vicariously liable unless (1) work involves ultra-hazardous activity (2) IC had apparent authority (3) principal attempted to delegate non-delegable duty (4) negligent hiring or supervision
General Partnership
(1) two or more people (2) carrying on as co-owners (3) of a business for profit - no formalities; profit sharing presumption
default rules of partnership under RUPA
(1) partners share profits and losses equally (2) partners not entitled for remuneration for services performed for business (3) partners have equal rights to manage (4) unanimous consent required for decisions outside of course of business, majority required for decisions in the course of business
liability of dissociated partner
liable for obligations occuring before dissociation and within 2 years after
formalities for limited partnership
(1) must have at least one general and one liable partner (2) certificate filed with Secretary w/ pship name, name/address of all general partners, and address of agent for service of process
Rights of general partner
(1) right to manage pship (2) right to vote on any matter (3)liable for debts and obligation of limited partnership
rights of limited partner
(1) no right to manage pship (2) right to vote on specific matters (3) right to obtain pship info (4) generally not liable for pship’s debt past contribution
Partnership property determination
(1) acquired by pship (2) titled under pship name (3) usage of property
Holding partners liable
(1) bring a claim against partnership and partners (2) serve partnership and partners (3) obtain judgment (4) if pship can’t cover obligation, served partner must fulfill the obligation
Duty of loyalty
duty to act in the best interest of the partnership
duty of care
refrain from (1) grossly negligent or reckless conduct (2) intentional misconduct or (3) knowing violation of law
