Lecture 1: Agency Flashcards
what is an agent
any person who acts on behalf of another
what is an agency
is the relationship which exists between two persons called agent and principle
how does an agency relationship arise
generally speaking
through agreement
usually commercial or business arrangement
–>contractual relationship between P and A
how does law view agent
fiduciary (involving trust)
what are some examples of agents
company directors and other officers
partners in a general partnership
employees
soliciters/accountants/other professionals
how does an agency arise
specifically speaking
- by express or implied agreement between P and A- actual authority
- under doctrine of apparent/otensible authority - agency by estoppel
- by necessity
- by ratification of agents act by principal
explain express actual authority
express
most common method of creating an agency involves express agreement between P and A
principal appoints A and gives actual authority to act on his behalf
no formal requirements unless P requires A to execute deeds on behalf where must appoint A by deed
explain implied actual authority
arises from implied agreement between A and P is result relationship to each other or form their conduct
often extension of express actual but not always
Implied Actual Authority
case example
Directors allowed company chairman to act as managing director, but never appointed as managing director so no express authority to bind company, chairman made contract with third party on company behalf - chairman implied actual authority
explain apparent/otensible authority
arises from any agreement between P and A but in account P made representation to third party that agent has authority to act on behalf
principal may be estopped from denying this once third party acted on representation
Creation of Agency apparent/ostensible authority
D company had 4 directors but 1 director made all contracts as though managing director however never actually appointed so no actual authority company refused to pay out on one contract - company liable as on contract had given impression director had power to bind company Agency of Estoppel created
what is the relationship between apparent and actual authority
coincide with his actual authority
exceed his actual authority
exist independently of his actual authority
how is an agency created via Necessity
person acting as agent must be in control of P property result from an already existing relationship
genuine emergency must have arisen requiring A take particular action to protect interests of P
must be impossible for A get P instructions
A must act in good faith best interests of p in a way that’s commerically reasonable and proportionate
how does creation of ratification occur
occurs where agency relationship made retrospectively
person purports acting as agent enters into agreement with third party without any authority from principal
P not bound by agreement with third party but may choose to ratify it
puts parties in same position if act has been authorised from outset
What is the ratification criteria
A must have purported to be acting as A
A must have named P or P capable of being identified by third party
ratification take place within a reasonable time of contract being made
P adopt all of the contract
P must have had legal capacity to make contract when A made it and was ratified
What are the duties of an agent
fiduciary duties: duty to account confidentiality not to take a bribe not to make a secret profit avoid conflict of interest other duties: obey instructions care and skill personal performance
what are the exception to duty of agent
personal performance
P expressly authorises delegation
if A imply power to delegate from circumstances
if delegation is an act requiring no care and skill
if delegation become e necessary due to unforeseen circumstances
what are the remedies for breach of fiduciary duties
recovery of a secret profit from agent
refusal to pay A commission or salary
dismissal of A without notice
termination of contract with third party
recovery of amount of any bribe or alternatively a claim of damages for fraud
how an agency relationship may be terminated
-operation by law death of either party mental incapacity frustration bankruptcy of the P bankruptcy of A renders him unfit to perform his duties -by the parties completion of task agreement revocation by one party
what is the commercial agents
common law rights and duties between A and P been put on statutory footing but only for commercial agencies for sale of goods
commercial agent defined as self employed who has continuing authority of goods on behalf of another person
regulations give parties additional protection
what to consider about; liability on contracts made by agents
disclosed and undisclosed agency
breach of warranty and authority
agents liability in tort
what is a disclosed agency
A indicated expressly or through conduct that he’s acting as A whether or not the princpal for whom he is acting is actually identified
what is an undisclosed agency
third party isn’t told of P existence and believes that A is acting on own behalf
