Agency

Front 1

Agency refers to

Back 1

legal re/ship in which one party, the agent, acts on behalf of the other party, the principal, in bus dealings w/ 3rd parties

Front 2

What capacity must principal have?

Back 2

capacity to contract (ie. minor's appt of agent voidable; incompetents & most unincorporated orgs cannot be principals. But partnerships & other orgs can be principals & appoint agents).

Front 3

Does an agent need contractual capacity?

Back 3

No. Agent may be disqualified for representing both parties or by failing to have a required license.

Front 4

Formalities required for agency

Back 4

1. Consent of both
2. Consider/n not required
3. Wrtiting--generally not required except when K in which agent is to enter into w/in SoF.

Front 5

equal dignities rule

Back 5

Doctrine, adjunct to SoF, applies when a signatory to K acted through an agent--if writing required for K, then agent's authority to sign must be set forth in a writing.

Front 6

Modes of creating agency

Back 6

act of parties or operation of law

Front 7

Act of parties which create agency

Back 7

1. express agreement b/n principal & agent (actual authority)
2. holding out by principal (apparent authority)
3. ratification (confirmation by principal after the act which makes it valid from time it was done)

Front 8

Way agency created by operation of law

Back 8

1. estoppel--3rd party's reliance on the principal's communication
2. stat. (usually for some limited purpose. e.g. appointing secretary of state as out of state motorist's agent for service of process)

Front 9

Agent's duties

Back 9

1. Express Kual duties
2. care
3. loyalty
4. obey reasonable directions
5. disclose all relevant info.

Front 10

Principal's remedies

Back 10

1. K actions (for paid agents)
2. Tort actions
3. Actions for secret profits
4. Equitable actions for accounting
5. W/holding of pay for intentional torts of breaches of fid. duty.
6, Principal may recover the actual profits or properties held by the agent whether or not the agent's profit has caused the principal any loss.

Front 11

Subagent

Back 11

person appointed by agent to perform some task in re to the agency. Agent has absolute liability to the principal for breaches by subagent.

Front 12

Duties of subagent

Back 12

If appointed w/ proper authority, subagent owes same duties as agent. If unauthorized, subagent owes no duty to principal but does to agent.

Front 13

Principals duties

Back 13

1. All express K duties
2, Reasonable compensation (for compensated agent)
3. reimbursement for expenses
4. General cooperation & avoiding of unreasonable interference w/ agent's duties

Front 14

Agent's remedies

Back 14

1. K remedies for compensated agent (but agent has duty to mitigate)
2. Right to possessory lien for $ due

Front 15

2 types of real estate broker's Ks

Back 15

1. nonexclusive--entitiles agent to compensation when agent brings ready, willing & able buyer even though sale not consumated.
2. Exclusive Ks--gets commission when anyone brings a ready, willing able buyer.

Front 16

Types of authority possessed by agent

Back 16

1. actual
2. apparent

Front 17

Actual authority is

Back 17

that power agent reasonably believes she possesses based on the principal's dealings w/ her.

Front 18

Actual authority is either

Back 18

Express or implied

Front 19

Express authority is

Back 19

that power which is actually contained w/in the 4 corners of the agency agreement. Effective even if obtained through mistake or misrepresentation.

Front 20

Implied authority is

Back 20

that which the agent reasonably believes he posses as a result of principal's actions.

Front 21

Implied authority includes

Back 21

1. authority incidental to express authority
2. customary practices
3, previous acquiescence by principal
4. taking action in an emergency
5, delegating authority for ministerial acts, where sit. require, where performance is impossible otherwise, where customary.
6. paying for delivery of goods
7. give gen. warranties as to fitness & quality, collect paymt, deliver
8. manage investments.

Front 22

How termination of actual authority may occur

Back 22

1. lapse of time
2. happening of a specific event
3. change in circumstances
4. agent's breach of fid duty
5. either party's unilateral termination
6. operation of law (e.g. death)

Front 23

When is an agency irrevocable?

Back 23

agency coupled w/ an interest or power given as security

Front 24

Apparent authority arises from

Back 24

reasonable belief of 3rd parties based on what principal did to indicate to the 3rd party that the agent had authority.

Front 25

Examples of situation in which agent has no actual authority but principal may still be bound

Back 25

1. Imposter--principal neg permitted impostor to be in a position to appear to have agency authority & 3rd parties believe agent had power b/e of something the principal did.
2. lingering apparent authority when actual authority has terminated. Notice of termination may be necessary to protect principal unless due to death or incapacity.

Front 26

Situations in which principal still bound though agent exceeds authority

Back 26

1. Prior act--when principal previously allowed agent to exceed authority & 3rd party knows about it.
2. Nature of position which customarily carries certain responsibilities.

Front 27

Inherent authority or inherent agency results

Back 27

in the principal being bound even though the agent had no actual authority to perform the particular act. Occurs b/e courts wish to protect innocent 3rd parties

Front 28

Examples of inherent authority

Back 28

a. respondeat superior--principal is held liable for the torts of her employee committed w/in the scope of employment
b. conduct similar to that authorized

Front 29

When will principal be held liable for disposition of his goods by an agent?

Back 29

if agent was given some indicia of ownership or if the goods disposed of were sold by an agent who is a dealer in the particular goods.

Front 30

Ratification is

Back 30

confirmation & acceptance of a previous act thereby making the act valid from the moment it was done.

Front 31

Upon ratification of an agent's actions,

Back 31

the principal is deemd to have adopted (the K or whatever) & agent is relieved of liability.

Front 32

What are requirements of principal for ratification to be effective?

Back 32

1. have capacity
2. know (or have reason to know) all material facts
3. accept the entire trans/n.
4. Consideration not required.

Front 33

Agent's liability to 3rd party depends

Back 33

on whether or not principal was disclosed.

Front 34

Principals' liability to 3rd party on a K entered into by agent depends on whether

Back 34

the agent had valid authority to act.

Front 35

When principal disclosed, who is generally liable? Exceptions?

Back 35

Disclosed principal generally liable, not agent.
Exceptions:
1. if parties to K intended the agent to be liable
2. agent may be liable to 3rd party under implied warranty that a principal w/ kual capacity exists and that he the agent had authority to K for the principal.

Front 36

Liability of partially disclosed or undisclosed principal

Back 36

results in liability for both principal & agent. MAJ of courts permit a 3rd party to file suit against both the principal & agent, but upon objection of either D, the 3rd party must elect prior to judgment wh party he wishes to hold liable. If 3rd party obtains a judgment against the agent w/o knowledge of the principal's ID, he can later sue the principal when her ID is discovered if the judgment has not been satisfied.

Front 37

When may principal/ agent enforce a K & hold 3rd party liable?

Back 37

If principal disclosed--only the principal, not the agent, may enforce the K & hold 3rd party liable.
If principal undisclosed, either may enforce

Front 38

When may principal NOT enforce K w/ the 3rd party?

Back 38

1. when fraudulent misrepresentation of the principal's ID
2. when increased burden to 3rd party due to the fact performance is due the principal & not the agent

Front 39

3rd party liability to principal & agent when agent partially disclosed or undisclosed

Back 39

either the principal or agent may enforce the K & hold the 3rd party liable. If agent enforces K, the principal is entitled to all of the rights & benefits thereunder.

Front 40

Generally, principal is bound when agent has

Back 40

valid authority (actual, apparent, by ratification)

Front 41

Generally agent is bound when

Back 41

principal's existence +/or ID not disclosed or partially disclosed (also can be liable for breach of implied warranty of authority)

Front 42

Generally 3rd party is bound

Back 42

to principal if agent had valid authority, bound to agent if principal partially disclosed or undisclosed & agent enforces K but principal entitled to K benefits.

Front 43

Whether principal is liable for torts committed by agents under respondeat superior theory depends first on

Back 43

whether agent is an employee or independent Kor. Generally, principal is liable only for torts committed by agents who are employees.

Front 44

How to determine if agent is employee or independent Kor.

Back 44

analyze right to control. If principal has no way to control manner & method of job performance, probably an ind Kor,

Front 45

Factors to consider when analyzing right to control in respondeat superior ?s

Back 45

1. how parties characterized
2. whether bus is distinct
3. customs
4. degree of skill required
5, whose tools or facililites are used
6. what period of employment (short, definite likely ind Kor.)
7. type of compensation
8. understanding of the parties
9. whether person was hired to further principal's bus (nonbus purpose e.g. mowing the lawn--more likely ind Kor)

Front 46

What is principal's liability for subservants?

Back 46

Doctrine of respondeat superior also applies. Authorization to hire subs can be express or implied. Employer generally not liable for torts of a sub if sub engaged w/o authority

Front 47

Liability for acts of borrowed employees depends on

Back 47

whether the borrowing or loaning principal has the primary right to control.

Front 48

Employer-employee by estoppel

Back 48

Where a principal creates the appearance of an employer-employee re/ship upon wh a 3rd party relies, the principal will be estopeed from denying the re/ship and will be liable under the doctrine of respondeat superior.

Front 49

Principal will incur liability for acts of indepdent Kors when

Back 49

1. inherently dangerous activities
2. nondelagable duties
3. when principal knowingly selected an incompetent independent Kor. (if principal neg, only liable for his own neg in selection, not for the Kor's neg.)

Front 50

Scope of employment

Back 50

range of reasonable & foreseeable activities that an employee engages in while carrying out employer's bus.

Front 51

Frolic & detour

Back 51

Frolic is minor deviation of employee from his employer's bus for his own purposes--considered still w/in scope of employment. Detour--an employee's major deveiation in time or geographic from his employer's bus for his own purposes--considered outside of the scope of employement.

Front 52

Whether intentional torts are w/in scope of employment

Back 52

depends on whether the activites are a natural incident of employee's duties.