Week 7

Question 1

Direct representation

Answer 1

Someone is given the authority to represent a person, acts in the name or on behalf of a principal with a third party (contracting party)

Question 2

Limiting factors of contract conclusion between 2 parties

Answer 2

• Geographical proximity
• Market knowledge
• Network of contacts
• Available time and time difference
• Costs

Question 3

Commercial benefits to involve an agent in the process

Answer 3

• Agent located in another country
• Agent may possess specialist market knowledge
• Agent may bring his own network of contacts
• Agent may operate in same time zone

Question 4

Indirect representation

Answer 4

Someone who acts in their own name but on behalf of the pricipal

the third party neither knows nor has reason to know that the intermediary acts as an agent

Question 5

Negative factors of using agents

Answer 5

• Agent located in another country
• Costs on commission basis

Question 6

Sensu lato

Answer 6

An intermediary
 Authority to commit another person
 Someone who has the power to commit his principal
 E.g. an Board Member

Question 7

Actual authority

Answer 7

I give someone else the power to act on my name and behalf

Express: on paper
Implied: To give the power, not on paper

Question 8

Apparent authority

Answer 8

My agent does not have an authority
But the third party has reasons to believe the agent has the power.

Question 9

Usual authority

Answer 9

Even if power was not given, it is common sense that he has power

Question 10

Surrounding circumstances

Answer 10

If a sales person in a shop is not authorised to give discounts to customers, but nevertheless does so

Question 11

Conduct of P

Answer 11

Failure to give notice that the mandate was withdrawn

Question 12

Agency of necessity

Answer 12

No power, No mandate, Not apparent

Necessary remedial action

Action to avert an imminent risk
 Normally A’s authority is conferred to him by P

Question 13

Commercial agentcy

Answer 13

A self-employed intermediary who has continuing authority to negotiate the sale or the purchase of goods on behalf of another person

Question 14

Does A need to work exclusively for P

Answer 14

No, A can work for multiple P’s
-Or only parttime
-If so, tied agent (extra restrictions apply)

Question 15

Can A work with subagents?

Answer 15

As long as the ordered tasks are not
- personal of nature
- reasonable expected to be executed by A

Question 16

Requirements to agent

Answer 16

Must be paid
Remuneration is awarded to the A

Question 17

Continuing Authority

Answer 17

A durable (permanent) and stable relation between P and A

How is it demonstrated?
- Number of affairs arranged for the P

Question 18

Formal requirements to conclude an agency agreement?

Answer 18

For its validity:
* Written agreement; or
* Oral agreement

Question 19

Obligations of the Agent

Answer 19

Communicate to P all the necessary information available to him
- All the necessary information with regards to clients’ orders
- General information about the market

Question 20

Obligations of the Principal

Answer 20

Provide A with necessary documentation relating to the
goods/services concerned
Provide A the information necessary for the performance of the
agency contract

Question 21

Commercial agent

Answer 21

Self employed, acts in my name and on my behalf and is paid for this

Question 22

Tight agents

Answer 22

exclusivity clause, work only for one company

Question 23

Can A work with subagents?

Answer 23

As long as the ordered tasks are not
- personal of nature
- reasonable expected to be executed by A

Question 24

Continuing Authority

Answer 24

Intention to work for many years for a reason

Question 25

Conclusion of agency agreement (written?)

Answer 25

No written contract needed
However, each party may ask for a written document

Question 26

Obligations of the Agent

Answer 26

• Agent must be proactive.
• At least TRY to sign the deals
• Communicate to P all the necessary information available to him
• Agent has to comply with instruction, recommendations of the principal
• Not binding strict rules

Question 27

Obligations of the Principal

Answer 27

• Principal must provide agent with all the necessary documentation
• Must provide agent with necessary information necessary to the performance of the contract

Question 28

When is A entitled to commission?

Answer 28

• Moment the sales transaction is concluded
• Even if he did not intervene later but still started the partnership
• Where A is entrusted with a specific geographical area or group of customers or has a specific right for that area or group

Question 29

Restraint of trade clause

Answer 29

An agreement restricting the business activities of a commercial agent following termination of the agency agreement
(Kind of goods and area)

Question 30

Franchise agreements

Answer 30

My risk, but Intellectual property rights of someone else

Question 31

Industrial franchise:

Answer 31

Franchisee produces the product himself, the basic receipee is the same. Slight moderations