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Flashcards in Agency Law Deck (13)
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1
Q

REG

What is Agency Law?

A

Agency Law deals with someone’s ability to bind you to a contract with a third party

2
Q

REG

What is required for Agency to exist?

A

Both parties must consent to the relationship and intend for an Agency relationship to exist

Agent owes Principal fiduciary duty

Principal doesn’t owe Agent fiduciary duty

A contract is NOT required and an Agency agreement is not based on Contract Law; Exception - If duties cannot be performed within a year; a signed writing is required

3
Q

REG

What is Actual Authority in an agency?

A

Actual Authority is what is expressly granted or is implied by the duties you expect the Agent to perform and is necessary to carry them out

4
Q

REG

What is Implied Authority in an agency?

A

When authority is expressly granted; it is implied that the agent has the authority to carry out the duties

Does not include authority to sell or alter a business

5
Q

REG

What is Apparent (Ostensible) Authority in an agency?

A

Apparent Authority is based on the third party’s perspective - they believe that the Agent has the
authority to enter into a contract based on:

  • Prior dealings with agent
  • Agent’s title leads the third party to believe they can enter into a contract
  • The Principal hires the Agent to carry out duties that normally carry with them the rights to enter into contracts
6
Q

REG

How is an Agency terminated?

A
  • Both Agent and Principal agree to terminate
  • Principal fires Agent
  • Agent fires Principal
  • Agent breaches their contract by doing something like violating their obligation to act as a fiduciary to Principal
7
Q

REG

How do you terminate Apparent Authority?

A
  • Let the public know
  • Let the people or entities that the Agent previously interacted with know
  • In cases of death; or Principal is otherwise not competent to contract; ALL authority is revoked
8
Q

REG

What is an Agency Coupled with an Interest?

A

Agent acquires an ownership interest in the Agency

Can only be terminated early (before the interest expiration date) by the Agent

Unless the Agency has a specific time limit spelled out in a contract; the Agent’s authority is irrevocable
by the Principal

9
Q

REG

When is an employee an Agent; and when does this make the employer liable?

A

Employees are agents while acting within the scope of their duties.

For employees who injure third parties while acting within the scope of their duties; both Employee and Employer are liable

10
Q

REG

When are Agents liable for torts (civil wrongs) they commit?

A

Agents are liable for torts (civil wrongs) committed whether they had authority or not

11
Q

REG

Are Agents who act outside of their authority liable?

A

Agents who act outside of their authority will be liable for the act

Exception - Principal ratifies the contract which relieves Agent of liability

In order to ratify; Principal must know all of the facts and must ratify before third party cancels agreement

If Principal keeps the benefits of the contract; ratification is implied

Contract must be 100% ratified or there is no contract

12
Q

REG

What is an Agent’s liability when acting for an undisclosed principle?

A
  • Agent liable to third party even if acting within authority
  • Third party can sue both Principal and Agent if Principal becomes disclosed
  • Agent can then sue Principal
13
Q

REG

What are the requirements for a Power of Attorney (POA)?

A

Must be in writing

Must be signed by person granting the POA

Ends upon death of Principal

General POA - Agent authorized to handle all affairs

Special POA - Agent authorized to handle only specific affairs