Liability of the Principal and the Agent to Third Parties

Question 1

What are the different principal disclosure rules?

Answer 1

Principals Disclosed: third party know the agent is acting on behalf of principal and the principal’s identity.
The parties to contract are 3rd party and principal.

Partially Disclosed: third party knows the agent is working on behalf of principal but identity is not known. The parties to the contract are principal, agent and third party.

Undisclosed: knows nothing. Parties to contract are agent and third party. Whether principal is party depends on agent’s authority to bind him.

Note: election of remedies doctrine requires third party to chose to hold liable the principal or agent.

Note: undisclosed: 3rd party still liable unless fraudulently concealed, or excluded from terms of contract.

Question 2

What are the requirements for respondeat superior?

Answer 2

1. The principal has sufficient control over the agent’s conduct such that the agency relationship is employee-employee
2. The tort committed by the agent was committed within the scope of employment.

Note: must have control over employee

Question 3

What are the exceptions to respondeat superior?

Answer 3

Task is inherently dangerous

The principal was negligent in hiring the independent contractor.

The principal retains control over certain tasks and the tort occurs within those tasks.

Question 4

What is a frolic and a detour?

Answer 4

Frolic: significant deviation from an assigned path - outside scope of employment.

Detour: minor deviation- within scope of employment.

Question 5

What s the rule for intentional torts?

Answer 5

Generally, outside the scope of employment.

Exceptions

• Conduct occurred within the scope and time limits of employment.
• The agent was motivated in some part to benefit the principal.
• The act was the kind the agent was hired to perform.