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Statements of Law > Agency > Flashcards

Agency Flashcards

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1
Q

Agency is a __ relationship between __ having K capacity and __ having mental capacity where they __ to (1) agent’s __ to act __, agent owing __ and being subject __ the principal and (2) the principal’s obligation __, __, __ the agent.

A

fiduciary
principal
agent
mutually consent
authority to act for and in the best interests of the principal
fiduciary duties of care, loyalty, and obedience to the principal
subject to the control of
obligation to not interfere, reasonably compensate, and reimburse

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2
Q

Agency is a

A

a fiduciary relationship between a principal, having K capacity, and an agent, having mental capacity, where they mutually consent to the agent acting on behalf and in the best interest of, owing fiduciary duties of care, loyalty, and obedience to, and subject to the control of the principal and the principal’s obligation to not interfere, reasonably compensate, and reimburse the agent.

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3
Q

Requirements for Formation of Agency

A

(1) Mutual Consent
(2) Principal Contractual Capacity
(3) Agent Minimal Mental Capacity
(4) Principal Control
(5) Agent Authority
(6) Writing* for term of years or equal dignities rule
No Consideration Required

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4
Q

Agent’s fiduciary duties include

A

(1) Duties to act in best interest of the terms of their agreement
(2) Duty of Care
(3) Duty of Loyalty
(4) Duty of Obedience

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5
Q

The Agent’s duty of care is

A

that of gent owes a duty of reasonable care that increases depending on the skill of the agent and level of compensation.

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6
Q

The Agent’s duty of loyalty is

A

a duty of undivided loyalty. The agent must:
(1) act solely for benefit of principal and account to principal if individually benefit
(2) not act adversely to principal by themselves or for a third party
(3) not compete with the subject of the agency
(4) not use principal property for purposes other than the principal.

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7
Q

The Agent’s duty of obedience is

A

a duty to obey reasonable directions of the principal, and, if breached, is liable to principal’s losses

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8
Q

The Agent’s breach of these fiduciary duties gives the Principal remedies to

A

(1) sue in contract for compensated agents
(2) sue in tort for a wide range of equitable remedies “to do justice” such as disgorgement of profits, constructive trust, and accounting

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9
Q

The Principal’s owes nonfiduciary duties including

A

(1) duties under their agency agreement
(2) reasonable compensation
(3) reimbursement for agent’s expenses
(4) indemnity
(5) cooperation with agent’s performance

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10
Q

The Principal’s breach of these nonfiduciary duties gives the Agent remedies to

A

(1) sue for contractual remedies

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11
Q

The Principal may be bound to Agent’s Contracts when Agent has

A

(1) Actual Authority, whether express or implied
(2) Apparent Authority
(3) Inherent Authority

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12
Q

The Principal may be bound to Agent’s Contracts when Principal

A

(3) grants authority after the fact by ratification

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13
Q

The Agent has actual express authority when

A

the authority is contained in the oral or written words of their agreement, regardless of mistake or misrepresentation.

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14
Q

The Agent has actual implied authority when

A

the Principal’s manifestations to the agent would lead a reasonable agent to believe they have authority

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15
Q

Examples of reasonable, actual implied authority include authority

A

(1) incidental to express authority
(2) arising from industry custom
(3) arising from past principal acquiescence
(4) arising from emergency measures
(5) arising from the title or position of the agent

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16
Q

Generally, the Principal is not bound by Agent’s contracts once actual authority has terminated, including

A

(1) happening of an event in their agreement
(2) lapse of reasonable time
(3) a change of circumstances
(4) Agent’s breach of fiduciary duty
(5) Eithers unilateral termination
(6) Operation of law, including death or incapacity of the principal and the agent is aware

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17
Q

The Agent has apparent authority when

A

The Principal’s manifestations to the third party would lead a reasonable third party to believe that the agent has authority; this protects third parties who rely on a principal’s manifestations of agency.

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18
Q

The Agent has apparent authority

A
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19
Q

Where the Agent exceeds or has no actual authority, they may still have apparent authority to bind the Principal when

A

(1) the third party knows that the principal has authorized Agent in the past.
(2) the third party knows that the agent has a title/position with power to act.
(3) the Principal negligently permits imposter agents to take actions, apparent authority by estoppel
(4) the apparent authority lingers

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20
Q

The Principal may be bound by Agent’s contracts when the apparent authority lingers after termination of authority such as

A

(1) third party lacks notice that the agent no longer has actual authority
(2) the third party lacks notice that the principal has died
(3) the third party is relying on a prior written actual authority

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21
Q

Where the Agent lacks either actual or apparent authority, the Agent may have inherent authority when

A

(1) they may bind the Principal based on their relationship, respondeat superior, such as employer-employee

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22
Q

Ratification

A
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23
Q

Express Ratification

A
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24
Q

Requirements for Ratification

A
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25
Knowledge
26
Entire Transaction
27
Capacity
28
What can be Ratified
29
What cannot be Ratified
30
Who may not Ratify
31
Undisclosed Principal
32
Unidentified Principal
33
Disclosed Principal
34
Third Restatement Principal Ratification
35
Principal Bound Analysis
Authority -> Actual -> Apparent -> Inherent -> Ratify`
36
Principal K Liability to 3rd
Bound if Agent had valid authority when K entered.
37
Agent K Liability to 3rd
Bound unless P existence and identity disclosed. Bound and breach implied warranty of authority if enters K with no authority and discloses and identifies P.
38
3rd K Liability to Principal and Agent
Bound to P if fully disclosed Bound to P or A if P is unidentified or undisclosed Not Bound if A misrepresented P identity or increased burden upon later disclosure of performance to P
39
Principal Tort Liability to 3rd
Vicarious Liability -> Derivative Liability -> Respondeat Superior or Apparent Authority -> Employee or Agent's torts Direct Liability -> Personal Liability -> Principal Torts, Actual Authority, Independent Contractor
40
Respondeat Superior
Vicariously liable for employee's torts committed within the scope of employment.
41
Employee v. Independent Contractor
-Threshold Question -Ultimate inquiry is right to control the manner and method of agent's daily duties and performance
42
Principal ("P") Vicarious Liability for Employee ("E") Torts
Generally, -Principal not liable for intentional torts because presumptively outside scope of employment and liable for negligence because ordinarily within scope of employment. -Court must look to factors for scope of employment.
43
Factors for Scope of employment
(1) conduct of the kind or similar to the what P inherently authorized (no actual authority or prohibition needed) (2) conduct on the job, a mere detour (small deviation in time and place), but not a frolic (substantial departure) (3) conduct where a substantial purpose is to benefit the principal (but not unauthorized use of instrumentality, invited passengers) (4) conduct that is ratified by principal with knowledge of all material facts
44
P Vicarious Liability for Independent Contractor ("ID") Torts
-Generally, not liable for ID's torts Except, (1) inherently dangerous activities like blasting (2) duties that can't delegate for public policy reasons like discrimination, premises safety (3) P knowing selection of incompetent ID
45
46
Factors for Right to control
47
Factors for Right to control
(1) level of skill for job (2) who provides tools and facilities (3) definite or indefinite employment (4) compensation by job or time (5) business purpose of P (6) Person has own distinct business (7) parties understanding (8)
48
Factors for Right to control
(1) level of skill for job (2) who provides tools and facilities (3) definite or indefinite employment (4) compensation by job or time (5) business purpose of P (6) Person has own distinct business (7) parties understanding (8) custom
49
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51
Factors for Right to Control
(1) level of skill for job (2) who provides tools and facilities (3) definite or indefinite employment (4) compensation by job or time (5) business purpose of P (6) Person has own distinct business (7) parties understanding (8) custom
52
Vicarious Liability for Loaned E's
Depends on who has the primary right of control Generally, the loaning P is liable.
53
P Vicarious Liability for Torts Under Apparent Authority
Agent appears to deal or communicate on behalf of P with apparent authority which enables A to commit or conceal a tort. Must be a nexus between tort and apparent authority.
54
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
55
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
56
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
57
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
58
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
58
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
59
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
59
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
60
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
61
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
62
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
62
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
63
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
64
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
64
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
65
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
65
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
66
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
66
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
67
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
67
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
68
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
68
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
68
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
68
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
69
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
69
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
69
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
69
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
70
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
70
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
70
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
70
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
71
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
71
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
71
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
72
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
73
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
73
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
73
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
74
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
75
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
75
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
76
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
76
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
77
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
78
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
79
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
80
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
81
Mutual Consent may be express or implied
express consent through written or oral statements implied through the parties' conduct
81
Minimal sufficient Control by Principal may be found when
they specify the task the agent is to perform without any details of the means.
81
Principal's Contractual Capacity requires
legal capacity, age of majority and sound mind
81
Agent's Mental Capacity Requires
at least some mental capacity to understand principal's directions
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