Drills 1-25 Flashcards
Who may terminate the agency relationship?
The termination may be unilateral- the principal or agent may terminate without the other’s consent.
What consideration is required to form an agency relationship?
None. An agent need not receive consideration (a gratuitous agent).
What doctrine places liability on an innocent principal for acts of an agent?
Vicarious liability asserts that a principal is liable for acts of an agent, even though the principal is innocent of fault and not directly guilty of any tort or crime.
An independent contractor is one who (list the 7 elements):
- Bears the risk and benefits from _______ _______________
- Maintains a high level of independence
- Is free to work for others
- Agrees to be paid a _____ ____
- Receives payment based on _______
- Is _______ for work performed, and
- Accepts responsibility to ___________ _________ at her own expense
- good management
- fixed fee
- results
- liable
- remedy defects
Can a minor serve as a principal or agent?
A minor may serve as an agent, but lacks the capacity to serve as principal. This is because to become a principal and be bound by an agent’s actions, a person must have capacity both to consent to the agency relationship and to enter into the transaction to which the agent purports to bind the principal.
What role, if any, may an incompetent play in the agency relationship?
A person who has a factual incapacity, such as incompetence, does not have the legal capacity to be a principal, but may be an agent.
What are the five “must have” duties an agent owes a principal?
- Duty of care
- Duty to __________ _______________
- Duty of loyalty
- Duty of ______________
- Duties not to usurp a ______________ ______________
provide information
obedience
business oppurtunity
Express actual authority can be created via:
- Oral or written words
- Clear, direct, and _________ ____________ or
- Specific detailed terms and _____________
definite language
instructions
What are the subjective and objective standards of intent for actual authority?
Subjective standard: the agent must believe that he/she is doing what the principal wants
Objective standard: the agent’s belief must be reasonable
What three things must an agent have or do to create an agency relationship?
- Have minimal capacity
- Manifest assent and consent to act on the principal’s behalf
- Manifest assent to be subject to the principal’s control
What is the difference in standard of care a compensated agent owes a principal compared with the standard of care an uncompensated agent owes?
Both owe the same standard of care: reasonable care
What are the eight ways in which an agent’s actual authority may be terminated?
- Principal’s revocation
- Principal’s agreement with the agent
- Change of circumstances
- Passage of time
- Principal’s death or suspension of powers
- Agent’s death or suspension of powers
- Principal’s loss of capacity
- A statutorily mandated termination
What are the four elements required for creating an agency relationship?
- A principal manifests assent to an agent
- The agent acts on the principal’s behalf
- The agent’s actions are subject to the principal’s control
- The agent manifests assent or otherwise consents
What is a subagent?
A person appointed by an agent to perform functions that the agent has agreed to perform on behalf of a principal. The agent is liable to the principal for the conduct of the subagent.
Does an agent have a right to be compensated if not expressly written in a contract, and if so, how much?
Yes, an agent has a right to receive compensation if the principal impliedly promises such. When no amount has been specified, an agent has the right to be compensated in the customary manner of the business trade.
