Agency Relationships Flashcards
What is an agent?
A person or entity that acts on behalf of another — the principal.
When does an agency relationship exist?
When there is:
- Assent
- Benefit, and
- Control
What is a universal agent?
An agent that has broad authority to act on behalf of the principal and is authorized to perform all acts the principal is allowed to perform.
What is a general agent?
An agent who normally has authority to conduct a series of transactions over a period of time for a particular purpose, business, or operation.
What is a special agent?
An agent with limited authority to conduct:
- A specific act/transaction, or
- Certain actions over a specified period of time.
What is assent?
A formal or informal agreement between the principal and the agent.
What is benefit?
The agent’s conduct on behalf of the principal primarily benefits the principal.
What is control?
The principal has some degree of control over the agent’s performance.
Is the characterization of the principal/agent’s relationship relevant?
No. It doesn’t matter if they say they aren’t principal/agent.
Define agency.
A fiduciary relationship, where a person or entity (the agent) acts on behalf of another (the principal) and both parties agree to the relationship.
What is the equal dignities rule?
An agency agreement must be in writing when the agent is to enter into contracts within the Statute of Frauds or when the agency agreement itself would fall within it.
What fiduciary duties does the agent owe to the principal?
All. Duties of care, loyalty, and obedience.
What fiduciary duties does the principal owe to the agent?
None. But owes obligations: contractual, reasonable compensation, and reimbursement for expenses.
How is an agency relationship terminated?
- Manifestation by either party
- Specifies term expires
- Death of principal or agent (and agent has notice)
- Incapacity of principal or agent
