Chapter 34: Agency Liabilities and Termination

Question 1

3 types of agency authority

Answer 1

1. actual authority arising by consent (express or implied)
2. apparent authority arising by estoppel
3. bootstrapping

Question 2

3 levels of disclosure

Answer 2

1. undisclosed principal - neither existence nor identity of principal known to 3rd party
2. partially disclosed principal - the existence but not the identity of principal known to 3rd party
3. fully disclosed principal

Question 3

2 primary rules of contractual liability of principals for agents acts

Answer 3

1. the principal is liable for contracts of an agent who acts with actual authority whether the principal is disclosed or undisclosed
2. where the agent acts without actual authority, the principal is not liable for the purported agent’s acts unless there is agency by estoppel or ratification

Question 4

tort

Answer 4

civil lawsuit other than breach of contract

Question 5

2 general rules of for tort liability

Answer 5

1. principal is liable for his own torts

2. an agent is liable for his own torts

Question 6

respondeat superior

Answer 6

an employer is liable for the torts of an employee acting in the scope and course of employment (vicarious liability)

Question 7

requirements of respondeat superior

Answer 7

1. an employer/employee relationship exists

2. employee commits the tort in the scope and course of employment

Question 8

scope

Answer 8

within the kind of activity the employee was hired to do

Question 9

course

Answer 9

substantially within the time and space limitations

Question 10

frolic/detour distinction

Answer 10

frolic < 30 miles < detour

Question 11

3 rules for intentional tort

Answer 11

1. the employer is liable for excessive force if force is part of the job
2. in some states, the employer is liable for the use of force if force was used to serve the master’s business
3. for nonphysical intentional torts like fraudulent misrepresentation, contract principals of actual and apparent authority apply

Question 12

4 ways to terminate agency by operation of law

Answer 12

1. death or incapacity
2. bankruptcy
3. drastic change in circumstances
4. impossibility

Question 13

4 ways to terminate agency by acts of the parties

Answer 13

1. initial or subsequent agreement of both parties
2. lapse of stated time
3. occurrence of a contemplated event
4. by one party with or without cause

Question 14

agency at will

Answer 14

an agency without specific time commitment is normally terminable by either party at any time

Question 15

agency for a term

Answer 15

an agency contracted for a certain time period

Question 16

agency for a term (termination)

Answer 16

the partied have the power to terminate at any time but not the right (termination without cause results in contractual liability)