Liabilities to 3rd Parties

Question 1

Contract Liability

Answer 1

Depends on A’s authority to bind P
P contractually liable to 3P for A’s acts w/ actual or apparent authority

Question 2

Actual Authority Generally

Answer 2

LOOK FOR LINK B/W P + A

P causes A to reasonably believe A has authority to act

Question 3

Express Actual Authority

Answer 3

Through written/spoken words

A must reasonably believe (subjective) she’s doing what P wants (objective)

Question 4

Actual Implied Authority

Answer 4

Lets A take whatever reasonable steps needed to achieve P’s objective w/I business practice/custom

Position (ex: make A VP)
Acquiescence (P accepts/stays silent)

Question 5

Apparent Authority

Answer 5

LOOK FOR LINK B/W P + 3P

P causes 3P to reasonably believe A has authority to act

3P’s reasonable belief can bind P based on past dealings/trade customs etc

A w/o authority acting in OCB can bind P if 3P lacks notice

Inherent authority from placing A in position w/ authority

Imposter w/o authority can bind P if P negligent in creating appearance of authority

Question 6

Ratification

Answer 6

w/ knowledge of material facts P affirms K made on their behalf

Question 7

Estoppel

Answer 7

P barred form denying agency relationship or A’s authority if 3p detrimentally relied & p’s negligence caused belief/p failed to correct mistake

Question 8

Agent Liability

Answer 8

A’s liability to 3P depends on P’s status

Question 9

Agent Liability: Disclosed Principal

Answer 9

if 3P had notice & knew identity of P, A NOT liable

Question 10

Agent Liability: Partially Disclosed/Unidentified Principal

Answer 10

if 3P had notice but didn’t know P’s identity, A liable

Question 11

Agent Liability: Undisclosed Principal

Answer 11

if 3P didn’t know of agency relationship at all A liable

Question 12

Agent Liability: Warranty of Authority

Answer 12

breached if A lacks power to bind P, A LIABLE

Question 13

Tort Liability: Respondeat Superior

Answer 13

P may be vicariously liable for tortious acts of A committed w/I scope of employment

Question 14

Independent Contractor Exception

Answer 14

P can be liable or IC torts when:
1. P retains control over item/task
2. P hires IC to perform nondelegable tasks
3. IC has apparent authority
4. P neg in selecting training or supervising IC

Question 15

Tort Liability: Acting w/I Scope

Answer 15

performing assigned work/acting subject to P’s control

Question 16

Tort Liability: Scope Exceptions

Answer 16

Frolic
Commuting (unless co car/employer errand)
Use of force unless necessary to complete task
Intentional tort unless acting for P’s purpose & closely connected to task
A acts independent of P’s purpose/benefit

Question 17

Tort Liability: Apparent Authority

Answer 17

P may be VL for A’s tortious act committed w/ apparent authority

Question 18

Tort Liability: Direct Liability

Answer 18

P may be directly liable to 3P for:

1. authorizing/ratifying A’s tortious conduct
2. negligently selecting/training/supervising A
3. delegating non-delegable duty

Question 19

Tort Liability: A’s Liability

Answer 19

A liable for own torts but not P’s