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7 Cards in this Set

  • Front
  • Back
Principal Liability for Ks Entered By Agent
"Principal is liable on its AUTHORIZED contracts."

Auhorized agents are not liable on their authorized contracts

(EXCEPTION -- if principal is undlsclosed:
Authorized agent liable if third-party choses to hold them so)
Principal Liability for Ks Entered By Agent

Authority

(4 Definitions)
Analyze each

1) Actual, Express

2) Actual, Implied

3) Apparent Authority

4) Ratification
Principal Liability for Ks Entered By Agent

Actual, Express Authority
principal uses express words of authorization

can be oral/private (EXCEPTION -- if K must be in writing, so too must the express authorization for that K -- usually SOF, land)

REVOCATION/TERMINATION:
1) by unilateral act of either principal/agent
2) incapacity of principal
3) death of principal
(EXCEPTION -- principal gives agent Durable Power of Attorney that survives death or incapacity)

NARROWLY TAILORED/CONSTRUED
Principal Liability for Ks Entered By Agent

Power of Attorney
Written expression of authority to enter a transaction
Principal Liability for Ks Entered By Agent

Actual, Implied Authority
1) Necessity -- implied authority to do all necessary to accomplish an expressly authorized task

2) Custom -- implied authority to do all tasks which are customarily performed by someone with the agent's title or position

3) Prior Dealings -- implied authority to do all tasks which the agent believes to have been authorized to do from prior acquiescence by the principal
Principal Liability for Ks Entered By Agent

Apparent Authority
Principal could still be liable if there is an appearance of authority

1) Has Principal done something to "cloak" agent with appearance of authority

2) Third-Party relies on apparent "cloaked" authority
Principal Liability for Ks Entered By Agent

Authority through RATIFICATION
AFTER the fact

1) Principal must have knowledge of material facts of contract

2) Principal must have accepted the benefits of that prior contract

Principal must ratify the entire contract as is