Agency Relationships

Question 1

Definition

Answer 1

when one person agrees to act on another’s behalf
principal- engages another to represent him
agent- acting on another’s behalf, represent someone else, entered into contract
could be oral or written

Question 2

Different agents

Answer 2

Power of attorney- represents you, written agency agreement, give person authority to make decisions
Employee- agent of their employer
Independent contractor- might work for you but isn’t your agent, principal can be legally bound by actions of agent.
control? who is giving the person their job? you hire plumber but the plumbing company is the one who gave him the job

Question 3

Agent’s duties to the principal

Answer 3

Duty of loyalty- duty of good faith, duty to keep principal informed, duty to account for monies handled

• Duty of obedience- agent has to obey all reasonable instructions
• Duty of reasonable care- have to carry out duties and be careful

Question 4

Termination

Answer 4

1. by the parties- both parties can agree to terminate at any time
2. expiration/accomplishment-expire by its own terms
3. change of circumstance- subject matter destroyed, hire to sell house and it burns down
4. operation of law: principal or agent: a. dies b. becomes incapacitated c. bankrupt d. doesn’t get license

Question 5

Contractual liability

Answer 5

agents ability to bind the principal to a contract depends on whether the principal authorized the agent’s actions

Question 6

actual authority

Answer 6

express permission to act on principals behalf, whether oral or written

1. based on agents reasonable belief- depends on their perspective
2. can be mistakenly granted- leave note on someone elses desk

Question 7

implied authority

Answer 7

authority agent reasonably believes is implied along with express permission
1. incidental- hire to manage hotel- implied you will buy towel and hire staff
have authority to do reasonable things
2. by acquiescense(ratification)- get flowers for lobby, didn’t have authority but boss ratified by agreeing. now yo impliedly have permission to buy them again

Question 8

apparent authority

Answer 8

no express authority but authority is reasonably assumed by third parties because of principals conduct

1. may be based on position or past actual authority
2. principal must give notice to terminate apparent authority
3. action against agent

Question 9

ratification

Answer 9

express or implied; principal approves of an action taken by the agent without authority, you can ratify an action without giving authority to keep doing it

Question 10

tort liability

Answer 10

vicarious liability-on employer, agent committing tort but hold principal liable
a. scope of employment- respondeat superior- let the master respond- as long as employee is there on employers behalf, whatever they do employer is held responsible for

Question 11

strict liability

Answer 11

considered liable without defense

example. dominos pizza, 30 minutes or less put pressure on employees, got into accident and woman sued bc employees did whatever it took to get there
- can get reimbursement from employee

Question 12

frolic and detour

Answer 12

employer is not liable if employee was acting outside the scope of his employment
-gets into accident in parking lot of a store while you were working

Question 13

intentional torts/crimes

Answer 13

principal can be liable for agents intentional torts if within scope of employment-destroy property while doing taxes, outside scope

Question 14

type of business organization

Answer 14

affects vicarious liability for acts of agents, joint and several liability, partners act as other partners agents