Creation of Agency

Question 1

Definition of Agent

Answer 1

Fiduciary relationship arising when there is manifestation of consent by one person to another to allow him to act on his behalf under his control, and consent by other to do so.

Question 2

Capacity requirement for agent

Answer 2

agent does not need capacity to contract, only principal does (so kids can be an agent and enter into K)

Question 3

Consideration for agency

Writing

Answer 3

not required

Not required

Question 4

Types of authority

Answer 4

Express Actual authority
Implied actual authority (Reasonable AGENT believes he has authority to enter into the K b/c of PRINCIPAL’s conduct)
Apparent authority (PRINCIPAL holds the agent out to have authority and THIRD PARTY reasonably believes it)
Power of position - being in a powerful position can be argued to be apparent authority b/c principal promoted agent to high position, reasonable 3d party believes agent had authority

Question 5

Ratification, methods

Answer 5

Principal bound to K if he ratifies. 1) principal has KNOWLEDGE of all material facts, 2) accepting ENTIRE K, 3) ratification doesn’t mess up other K of third party

Question 6

Liability on K b/w agent and principal

Answer 6

actual authority, apparent authority, ratification = agent not liable, principal is. IF not known there’s a principal, agent liable, IF principle’s IDENTITY not known, both principal/agent liable.

Question 7

Duties owed by agent:

Answer 7

Duty of Care, Duty of Loyalty, Duty of Obedience

Question 8

Duties owed by principal:

Answer 8

Duty to indemnify, duty to compensate

Question 9

Employee or Independent Contractor?

Answer 9

RIGHT TO CONTROL: skill required, tools/facilities provided, period of employment, basis of compensation (per job?), business purpose, distinct business?