Lecture 1: Agency

Question 1

what is an agent

Answer 1

any person who acts on behalf of another

Question 2

what is an agency

Answer 2

is the relationship which exists between two persons called agent and principle

Question 3

how does an agency relationship arise

generally speaking

Answer 3

through agreement
usually commercial or business arrangement
–>contractual relationship between P and A

Question 4

how does law view agent

Answer 4

fiduciary (involving trust)

Question 5

what are some examples of agents

Answer 5

company directors and other officers
partners in a general partnership
employees
soliciters/accountants/other professionals

Question 6

how does an agency arise

specifically speaking

Answer 6

1. by express or implied agreement between P and A- actual authority
2. under doctrine of apparent/otensible authority - agency by estoppel
3. by necessity
4. by ratification of agents act by principal

Question 7

explain express actual authority

Answer 7

express
most common method of creating an agency involves express agreement between P and A
principal appoints A and gives actual authority to act on his behalf
no formal requirements unless P requires A to execute deeds on behalf where must appoint A by deed

Question 8

explain implied actual authority

Answer 8

arises from implied agreement between A and P is result relationship to each other or form their conduct
often extension of express actual but not always

Question 9

Implied Actual Authority

case example

Answer 9

Directors allowed company chairman to act as managing director, but never appointed as managing director so no express authority to bind company, chairman made contract with third party on company behalf - chairman implied actual authority

Question 10

explain apparent/otensible authority

Answer 10

arises from any agreement between P and A but in account P made representation to third party that agent has authority to act on behalf
principal may be estopped from denying this once third party acted on representation

Question 11

Creation of Agency apparent/ostensible authority

Answer 11

D company had 4 directors but 1 director made all contracts as though managing director however never actually appointed so no actual authority company refused to pay out on one contract - company liable as on contract had given impression director had power to bind company Agency of Estoppel created

Question 12

what is the relationship between apparent and actual authority

Answer 12

coincide with his actual authority
exceed his actual authority
exist independently of his actual authority

Question 13

how is an agency created via Necessity

Answer 13

person acting as agent must be in control of P property result from an already existing relationship
genuine emergency must have arisen requiring A take particular action to protect interests of P
must be impossible for A get P instructions
A must act in good faith best interests of p in a way that’s commerically reasonable and proportionate

Question 14

how does creation of ratification occur

Answer 14

occurs where agency relationship made retrospectively
person purports acting as agent enters into agreement with third party without any authority from principal
P not bound by agreement with third party but may choose to ratify it
puts parties in same position if act has been authorised from outset

Question 15

What is the ratification criteria

Answer 15

A must have purported to be acting as A
A must have named P or P capable of being identified by third party
ratification take place within a reasonable time of contract being made
P adopt all of the contract
P must have had legal capacity to make contract when A made it and was ratified

Question 16

What are the duties of an agent

Answer 16

fiduciary duties:
duty to account 
confidentiality 
not to take a bribe 
not to make a secret profit 
avoid conflict of interest 
other duties:
obey instructions 
care and skill
personal performance

Question 17

what are the exception to duty of agent

personal performance

Answer 17

P expressly authorises delegation
if A imply power to delegate from circumstances
if delegation is an act requiring no care and skill
if delegation become e necessary due to unforeseen circumstances

Question 18

what are the remedies for breach of fiduciary duties

Answer 18

recovery of a secret profit from agent
refusal to pay A commission or salary
dismissal of A without notice
termination of contract with third party
recovery of amount of any bribe or alternatively a claim of damages for fraud

Question 19

how an agency relationship may be terminated

Answer 19

-operation by law
death of either party 
mental incapacity 
frustration 
bankruptcy of the P
bankruptcy of A renders him unfit to perform his duties 
-by the parties 
completion of task
agreement 
revocation by one party

Question 20

what is the commercial agents

Answer 20

common law rights and duties between A and P been put on statutory footing but only for commercial agencies for sale of goods
commercial agent defined as self employed who has continuing authority of goods on behalf of another person
regulations give parties additional protection

Question 21

what to consider about; liability on contracts made by agents

Answer 21

disclosed and undisclosed agency
breach of warranty and authority
agents liability in tort

Question 22

what is a disclosed agency

Answer 22

A indicated expressly or through conduct that he’s acting as A whether or not the princpal for whom he is acting is actually identified

Question 23

what is an undisclosed agency

Answer 23

third party isn’t told of P existence and believes that A is acting on own behalf