Agency Relationship

Question 1

What are the three ways the creation of an agency relationship has “the power to bind”

Answer 1

• may be express orally or in writing
• implied by Principal’s conduct, or
• misinterpreted by a third party

Question 2

Define

How Principal has control

Answer 2

the Principal has the right to control the result or the ultimate objectives of Agents work

Question 3

What are the three kinds of Principals

Answer 3

Individual, Employer, or entity (Entrepreneurs, corporations, and partnerships)

Question 4

Define

Individual Principal

Answer 4

a person’s status as a Principal is established by the person’s intent to delegate an act and control the way in which the act is performed by another

Question 5

Define

Employer Principal

Answer 5

Principal who employs an employee to perform services and has the right to control the physical conduct of the employee’s performance

P’s control over day-to-day activites, supplying tools of trade, structured pay period, specialized skill level, and P directs work to completion