II-1 Agency

Question 1

What are 4 types of agency relationships?

Answer 1

1. General agent.
2. Special agent.
3. Universal agent.
4. Power of attorney.

Question 2

What is general agent?

Answer 2

One authorized to conduct all necessary personal or business transactions for the principal.

Question 3

What is special agent?

Answer 3

Limited in time and purpose. One authorized to conduct a single transaction or series of related transactions on the principal’s behalf.

Question 4

What is universal agent?

Answer 4

One authorized to do all acts that can be legally delegated to an agent.

Question 5

What is power of attorney?

Answer 5

A formal written creation of an agency relationship that lists the authority granted. Can be general or special (limited).

Question 6

What is a requirement for power of attorney to be valid?

Answer 6

It must be signed by the principal but not by agent.

Question 7

Who is independent contractor?

Answer 7

someone who acts on behalf of a principal, but that principal does not control the agent’s day-to-day activities. The scope is limited.

Question 8

What are 2 requirements of the creation of an express agency relationship?

Answer 8

1. Writing/record is not generally required, but if its’ a requirement such as the case of the contract is under the State of Frauds.
2. Capacity of principal (not agent).

Question 9

Is consideration required for the formation of agency relationship?

Answer 9

No.

Question 10

What is the agency relationship without consideration called? What is a characteristic of this agent?

Answer 10

A gratuitous agency relationship.

Can quit anytime.

Question 11

Are express and implied agency relationship mutually exclusive?

Answer 11

No, express could include implied.

Question 12

What is implied relationship?

Answer 12

Whatever anyone in the same position is permitted to do.

Question 13

What is apparent agency? An example?

Answer 13

This is an agency relationship in which the agent does not have an express agreement but still has authority to act as an agent for a principal because of the appearance of having that authority.
Agent is not the Principal’s employee, but principal does not deny it when agent says so in front of X. X later can sue principal for agent’s action.

Question 14

What is lingering apparent agency?

Answer 14

when the principal fires an agent (ends the actual or express agreement), but the agent continues to act as an employee. The agency continues until properly terminated.

Question 15

What is agency by estoppel or ostensible authority?

Answer 15

this agency relationship is another form of apparent authority agency that is created when the principal acts as if another is his or her agent.

Question 16

What does creation of an agency relationship by ratification?

Answer 16

the agent does not have express, implied, or apparent authority, but he or she enters into a contract on behalf of an assumed principal. The principal is not bound, but ratification gives the principal a choice.

Question 17

Ratification: can a contract ratify in part?

Answer 17

No, it has to be the entire contract if ratified.

Question 18

Ratification: Can a third party withdraw before principal ratifies it?

Answer 18

Yes.

Question 19

Does ratification must be expressly stated in the contract?

Answer 19

No. Can be words or action.

Question 20

What is the requirements for Statute of frauds?

Answer 20

Sale of goods of more than $500, real estate, contracts impossible to perform within a year, promise to answer the debt of another, an executor’s promise to be personally liable for the debt of an estate.

Question 21

Is independent contractor an agent? Why?

Answer 21

No. Because principal does not have the same degree of control over him.

Question 22

What is contained in “actual authority”?

Answer 22

Express authority and implied authority.

Question 23

What must a principal do to terminate lingering apparent relationship?

Answer 23

Cut off actual and constructive (pubic) authority by giving a notice.

Question 24

What are 3 elements of ratification?

Answer 24

Retroactive, full knowledge, accepts or fails to reject.

Question 25

Wha are 2 duties of agent? Of principal?

Answer 25

A: Follow instructions, Fiduciary (act in the best interest for principal).
P: Liability (indemnification).

Question 26

What are principal’s duties to agent?

Answer 26

Compensation unless it’s gratuitous, reimbursement for reasonable expenses, indemnification.

Question 27

What are 3 ways to terminate agent?

Answer 27

• By agreement: automatic termination date, accomplishment of task.
• By unilateral act: Fired/quit (at will) - only terminate actual authority (express and implied).
• By operation of law.

Question 28

What are 4 ways operations of law can happen?

Answer 28

Death, insanity/lack of capacity, bankruptcy, breach of fiduciary duty.

Question 29

What does it mean when agency discloses? Undisclosed?

Answer 29

The third party knows who the principal is.

Agent acts like he is doing it on his behalf.

Question 30

Contract liability of disclosed principal (agent has actual authority): who is liable to who?

Answer 30

Principal to the third party / The third party to principal..

Question 31

Contract liability of disclosed principal (agent has apparent authority): who is liable to who?

Answer 31

Principal to the third party / Third party to principal..

Principal to agent / Agent to principal.

Question 32

Contract liability of disclosed principal (agent has no actual or apparent authority): who is liable to who?

Answer 32

Agent to the third party and vice versa.

Question 33

Contract liability of undisclosed or partially disclosed principal (with actual authority): who is liable to who?

Answer 33

Principal to agent.
Principal to third party and vice versa.
Agent to third party and vice versa.

Question 34

Contract liability of undisclosed or partially disclosed principal (contract outside actual authority): who is liable to who?

Answer 34

Agent to third party and vice versa.

Question 35

Is ratification possible when principal is undisclosed?

Answer 35

No.

Question 36

Is agent liable for torts they commit? When instructed to do so?

Answer 36

Yes. Yes.

Question 37

What is the element used to determine between servant and independent contractor? What is the doctrine used to hold principal responsible for agent’s action?

Answer 37

Degree of control.

Doctrine of Respondeat Superior (vicarious liability).

Question 38

What is frolic and detour?

Answer 38

Employees are not in the scope of employment when outside of it such as lunch break.

Question 39

Agent tort authorized (tort committed within the scope): who is liable?

Answer 39

Both agent and principal.

Question 40

Agent tort NOT authorized: who is liable?

Answer 40

Agent.

Principal if negligent hiring, negligent supervision, implicit approval.

Question 41

Can agent receive workers compensation even if they were negligent?

Answer 41

Yes, because it is the scope of employment.

Question 42

When an agent has an interest, who has the right to terminate the agency before the interest has expired?

Answer 42

Only by the agent.

Question 43

What is an agency coupled with an interest? (for whose benefit?)

Answer 43

An agency coupled with an interest is one that is created primarily for the benefit of the AGENT.