REG - Agency

Question 1

Termination of Principal-Agent Relationship

Answer 1

Either by actions of the parties (principal and/or agent) OR by operation of law

Question 2

Notice of termination to third parties

Answer 2

Constructive or Actual

Notice is not required when termination occurs due to operation of law

Question 3

agency coupled with an interest

Answer 3

agent must have either a property interest or a security interest in the subject matter of the agency relationship

principal does not have power to terminate agency coupled with an interest

Question 4

apparent authority

Answer 4

exists when a third party has reason to believe that an agent has the authority to enter into contracts of the nature involved, based upon a principal’s representations

Question 5

Is consideration required for the creation of an agency relationship?

Answer 5

No

Question 6

Agency contracts “within the statute” of frauds

Answer 6

1. an agreement to sell land or any interest in land

2. an agreement that cannot be performed within 1 year from the making of agreement

Question 7

When does Principal ratification occur?

Answer 7

When there is a subsequent approval but the principal of the agent’s unauthorized action. In order for ratification to take place, the principal must have knowledge of all material facts regarding the contract