STUDY UNIT SIXTEEN AGENCY AND REGULATION Flashcards
A principal is most likely to be held criminally liable for the crime of an agent who
A. Violated a regulatory statute.
B. Acted within the course and scope of employment.
C. Committed the crime without the approval of the principal.
D. Committed the crime without the participation of the principal.
A. Violated a regulatory statute.
Answer (A) is correct.
A principal is liable for his or her own criminal conduct but is generally not liable for a crime committed by the agent. A principal may be held criminally liable for a crime of the agent if (1) the principal approves or directs the crime, (2) the principal participates or assists in the crime, or (3) violation of a regulatory statute constituted the crime. A regulatory statute in this context is one that imposes strict liability, for example, a law that prohibits sales of liquor to minors.
(16.3.57)
An agent who acts within the scope of actual or apparent authority most likely is contractually liable to a third party when
A. The agent guaranteed the principal’s performance.
B. The agent commits a tort.
C. The principal is liable to the third party.
D. The principal is disclosed.
A. The agent guaranteed the principal’s performance.
Answer (A) is correct.
The agent may assume liability on any contract by (1) making the contract in his or her own name, (2) co-making the contract with the principal, or (3) guaranteeing the principal’s performance. The agent also is liable for his or her torts and crimes.
(16.2.38)
With regard to an agreement for the sale of real estate, the statute of frauds
A. Does not apply if the value of the real estate is less than $500.
B. Requires that the purchase price be fair and adequate in relation to the value of the real estate.
C. Requires that the entire agreement be in a single writing.
D. Does not require that the agreement be signed by all parties.
D. Does not require that the agreement be signed by all parties.
Answer (D) is correct.
An agreement for the sale of real property is within the statute of frauds. To be enforceable it must satisfy requirements of the statute: a written memorandum must name the parties, describe the subject matter, state the essential terms, recite the consideration, and be signed by the party to be charged. Other parties need not sign it.
(17.7.83)
Jones, CPA, entered into a signed contract with Foster Corp. to perform accounting and review services. If Jones repudiates the contract prior to the date performance is due to begin, which of the following is false?
A. Foster can obtain a judgment ordering Jones to perform.
B. Foster can obtain a judgment for the monetary damages it incurred as a result of the repudiation.
C. Foster could successfully maintain an action for breach of contract after the date performance was due to begin.
D. Foster could successfully maintain an action for breach of contract prior to the date performance is due to begin.
A. Foster can obtain a judgment ordering Jones to perform.
Answer (A) is correct.
Repudiation before the time of performance is an anticipatory breach. Anticipatory breach occurs when a party indicates that (s)he will not perform. This indication may be express or implied by express statement, selling property, going out of business, or not meeting an installment due. The injured party may treat the contract as breached and immediately file suit, or as continuing and hold the breaching party accountable when performance is due. But a contract for personal services is not specifically enforced. Damages might be inadequate when the subject matter is unique. But forced performance may not be satisfactory and could be construed as involuntary servitude.
(17.10.122)
