AGENCY LAW & TORT LAW Flashcards
(27 cards)
What is Agency Law?
law of one person affecting the legal relations of another.
what are the two main issues regarding agency law?
- whether one party is responsible for the actions of another; and
- what rights and obligations do parties have to one another.
what is an Agency?
the fiduciary relationship that arises when one person (a principal) manifests assent to another person (an agent) that the agent shall act on the principal’s behalf and subject to the principal’s control, and the agent manifests assents or otherwise consents so to act.
how does a party manifest assent to an agency K?
a person manifests assent or intention through written or spoken words or other conduct.
what is the central issue regarding whether an agency k has been formed?
whether a principal-agent relationship exists.
what are the elements of an agency K formation?
consent;
to act on another’s behalf; and
subject to another’s control by the principal.
who are the 3 payers in an agency?
principal;
agent; and
third party
what are the basic principles that govern agency relationships?
The agent has certain duties and obligations to the principal;
The principal has certain duties and obligations to the agent;
The principal is responsible for tortious acts committed by the agent on a 3rd party that falls within the scope of the agency;
The agent can enter into a binding agreement with 3rd parties on the principal’s behalf, as long as the agreement may be traced to the principal’s authority; and
The agent’s knowledge (in the subject matter of the agency) is imputed to the principal.
when does an agency relationship arise?
only when the elements stated in section 1.01 are present. Whether a relationship is characterized as an agency in an agreement between parties or in the context of industry or popular usage is not controlling.
how is a “person” defined in an Agency?
A person is an individual; an organization or association that has legal capacity to possess rights and incur obligations; a government, political subdivision, or instrumentality or entity created by government; or any other entity that has legal capacity to possess rights and incur obligations
what are the formation requirements for an Agency K?
If the law requires a writing or record signed by the principal to evidence an agent’s authority to bind a principal to a K or other transaction, the principal is not bound in the absence of such a writing or record.
what are the fiduciary duties of an Agent under Agency K?
loyalty;
due care; and
good faith
what can’t an agent do?
take;
seize;
use; and
skip;
What is authority?
When an agent acts with either of the types of authority the agent binds the principal to the K they have entered.
what are the types of authority in Agency Law?
Actual/Express;
Inherent;
Implied;
Apparent; and
Ratification
what is Actual/Express authority?
when the principal communicates through spoken or written to the agent about the activities in which the agent may engage and the obligations the agent may undertake.
what is inherent authority?
there are certain things an agent is required to do to execute an agency K (necessities)
what is implied authority?
things that are not necessary to the agency relationship but are reasonable to facilitate the agency K
what is apparent authority?
the authority that other people think the agent has as a result of the principal’s action
what is the test for apparent authority?
Whether the principal has either engaged in affirmative conduct that creates the appearance of authority or the reasonable appearance of authority in third parties; or
Whether the principal has failed to correct the agent’s conduct in such a manner that 3rd parties can reasonably believe that the agent has the authority to do whatever it is they do
what is ratification?
authority that is granted by the principal after an agreement has been made.
what are the limits on ratification?
The principal must know or have reason to know, at the time of the alleged ratification, the material facts relating to the transaction;
A principal may not partially ratify a transaction;
If the third party manifests an intention to withdraw from the transaction before the ratification, the principal may not then ratify the agreement;
Ratification will be denied when necessary to protect the rights of innocent third parties
what issues arise regarding authority?
whether the agent has the authority to act on behalf of the business when the business is bound by, or liable for, the actions of its agents; and
What duties and responsibilities an agent might have to a business.
what are the types of principals under Agency Law?
disclosed;
unidentified; and
undisclosed.
