agency Flashcards
(24 cards)
agency
a fiduciary relationship in which the agent acts on the principals behalf and the principle consents
consent req by both parties
agent must act for the benefit of principal
control, at minimum, equates to the ability to delegate a task to
creation of agency
principal: contractual capccity
agent: minimum capacity
writing not req unless agency over 1 year
modes of creating agent relationship
parties express agreement (actual authority)
holding out as agent relationship to others BY the principal
fiduciary duties of an agent
loyalty
care
obedience
duty of care
carry out responsibilities with reasonable care
duty of loyalty
undivdied loyalty to the principle
duty of obedience
obey all reasonable instructions of the principal
remedies for breach of fiduciary duty
contract actions tort ill gotten profit equitiable actions for an accounting imposition of a constructive trust (transfer unnust enrichment property to a trust)
principals duty to the agent
not fiduciary
contract
reasonable compensation
reimbursement for expenses
agent remedies
contractual
actual authority
Actual authority is authority that the agent reasonably
believes they possess based on the principal’s dealings with
them
Actual
authority may be express or implied.
express and implied authority
express:
- oral or written
- binding even if given by mistake or misrepresentation
implied: reasonable belief by the agent tas a result of the principals words/actions:
Incidental to express authority
• Arising out of custom known to the agent
• Resulting from prior acquiescence by the principal;
• To take emergency measures
• To delegate authority in cases of ministerial acts,
where circumstances require, where performance
is impossible without delegation, or where delegation
is customary
termination of actual authority
happening of event lapse of a reasonable time a substantial change in circumstances such that authority inferred to be done breach of fidciary duty*** either parties unilateral termination operation of law
apparent authority
Apparent authority exists when the principal “holds out”
another as possessing authority and based on this holding
out, a third party is reasonably led to believe that authority
exists
main thing: apparent authority exists when reasonable belief of third party coupled with holding out by principal
types of apparent authority
agent exceeds actual authority
prior act the principal knows the third party is aware of
title of the agent (as given by the principal) indicates to a third party they have authority
what about imposters
can bind the principal IF the principal negligently allows the imposter to pretend to be agent
ratification
an agent acts without authroirty, and a principal subsequently validates that act
express or implied: accepts benefit of a contract
req for ratification
knowledge of ALL material facts AND
accept entire transaction AND
have capacity at the time of acceptance
can an agent be liable to a third party?
yes, if the agent entered agreement AND existence and identity of principal are not disclosed
if agent has authority to enter this agreement, BOTH the agent and the principal can be held liable
tort laibility
liable for conduct of employee, not independent contractor
employee vs independent contractor test
right to control test:
degree of skill needed
whos tools/facilities used
period of employment
basis of compensation
business purpose
if person has a distinct business
characterization and understanign of parties
scope of emplyment and frolic and detour
if during employment time, conduct of the kind agent hired to perform, and benfit employer
if a small deviation: then still liability (detour)
if substantial departure from employment, frolic, no liability
are employers liable for agents intentional torts
no, unless within scope of employment (security guard)
If no respondeat superior, then can apparent authority still work for torts
yes, if the apparent authoirty
- enable the agent to commit tort OR
- conceal tort commission
