Apparent Authority and Ratification

Question 1

Apparent Authority

Answer 1

The principal creates apparent authority by words, written or spoken, that cause the third party to reasonably believe that the principal consents to have acts done on the principal’s behalf by the agent.

Question 2

What to look at to determine if there is apparent authority?

Answer 2

1. Whether the third party’s belief was reasonable?
2. Whether the principal and the third party had similar dealings before?

Question 3

Ratification

Answer 3

Requires that:

1. The principal be aware of the material terms of an agreement; and
2. Accept the benefits of such agreement

Question 4

T or F: An agent and principal can be liable for the actions that agent did on behalf of the principal

Answer 4

True