2. Agency - Principal's Liability for Contracts Entered Into by Agent Flashcards Preview

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Flashcards in 2. Agency - Principal's Liability for Contracts Entered Into by Agent Deck (16):
1

When is P liable for contracts entered into by A?

When P authorised the contract

2

Authority

What are the four types of authority?

1. Actual express

2. Actual implied

3. Apparent authority*

4. Ratification

3

Authority

What is the scope of actual express authority?

It is narrowly limited to the words expressed

4

Authority

Must express authority be in writing?

Only if the contract to be entered into must be in writing

5

Authority

What are the two ways in which express authority can be revoked?

1. Death or incapacity of P, unless A has durable power of attorney

2. Unilateral act by P or A revoking the authority

6

Authority

What are the three categories of actual implied authority?

1. Necessity

2. Custom

3. Prior dealing

7

Authority

What is actual implied authority by necessity?

A has implied authority to do anything necessary to achieve an expressly authorised task

8

Authority

What is actual implied authority by custom?

A has implied authority to do anything customarily done by someone with his title

9

Authority

What is actual implied authority by prior dealings?

A has implied authority to do anything he believes he is authorised to do based on prior acquiescence

10

Authority

What are the two requirements for apparent authority?

1. P cloaks A with appearance of authority

2. Third party reasonably relies upon that appearance of authority

11

Authority

What gives rise to authority by ratification?

P grants authority after a contract is entered into

12

Authority

What are the three requirements for authority by ratification?

1. P knows of all material terms

2. P accepts the benefit

3. Ratification does not alter any term

13

Liability

Are P and A both liable for authorised contracts?

 

P is, A is not

14

Liability

What does the undisclosed principal exception allow?

 

It allows a third party to recover from A

15

Liability

One of what two things triggers the undisclosed principal exception?

 

1. P's identity was concealed

2. The fact there was a P/A relationship at all was not disclosed

16

Liability

What is the one limitation placed on a plaintiff regarding the  undisclosed principal exception?

 

They cannot recover from both P and A, only one