Ch 13/14 - Agency, Business Forms Flashcards
agency
relationship that exists when one party represents another party in the formation of legal relations
agent
a person who is authorized to act on behalf of another
principal
a person who has permitted another to act on her behalf
outsider
the party with whom the agent does business on behalf of the principal
law of agency
the law governing the relationship where one party, the agent, acts on behalf of another, the principal
actual authority
the power of an agent that derives from either express or implied agreement
apparent authority
the power that an agent appears to have to an outsider because of conduct or statements of the principal
agency by estoppel
an agency relationship created when the principal acts such that third parties reasonably conclude that an agency relationship exists
agency by ratification
an agency relationship created when one party adopts a contract entered into on his behalf by another who at the time acted without authority
fiduciary duty
a duty imposed on a person who has a special relationship of trust with another
fiduciary
a person who has a duty of good faith toward another because of their relationship
insurance broker
one who provides advice and assistance to those acquiring insurance
warranty of authority
a representation of authority by a person who purports to be an agent
undisclosed principal
a principal whose identity is unknown to a third party who has no knowledge that the agent is acting in an agency capacity
sole proprietorship
an unincorporated business organization that has only one owner
unlimited liability
unrestricted legal responsibility for obligations
partnership
a business carried on by two or more persons with the intention of making a profit
joint liability
liability shared by two or more parties where each is personally liable for the full amount of the obligation
joint and several liability
individual and collective liability for a debt. Each liable party is individually responsible for the entire debt as well as being collectively liable for the entire debt
limited partnership
partnership in which the liability of some partners is limited to their capital contribution
limited liability partnership (LLP)
partnership in which the partners have unlimited liability for their own malpractice but limited liability for other partners’ malpractice
shareholder
a person who has an ownership interest in a corporation
director
a person elected by shareholders to manage a corporation
limited liability
responsible for obligations restricted to the amount of investment
dividend
division of profits payable to shareholders
franchise
an agreement whereby an owner of a trademark or trade name permits another to sell a product or service under that trademark or name
joint venture
grouping of two or more businesses to undertake a particular project
strategic alliance
an agreement whereby two or more businesses agree to cooperate for some purpose
distributorship
a contractual relationship where one business agrees to sell another’s products
sales agency
an agreement in which a manufacturer or distributor allows another to sell products on its behalf
product licensing
an arrangement whereby the owner of a trademark or other proprietary right grants to another the right to manufacture or distribute products associated with the trademark or other proprietary rights
