Va Agency & Partnership

Front 1

VA Agency & Patnership

Principal’s liability for Agent’s Torts

Back 1

Assent, Benefit and Control PLUS (+) Scope
Generally, no vicarious liability for the independent contractors torts.
Intentional torts are generally outside scope.

Front 2

VA Agency & Patnership

Duties Agent owes Principal

Back 2

1. Care
2. Obedience
3. Loyalty (disgorge profits)

Front 3

VA Agency & Patnership

Partnership formation

Back 3

1. No general partnership formalities.
2. Association, two or more persons, carrying on business for profit.

Front 4

VA Agency & Patnership

Relations between partners

Back 4

1. Fiduciaries - accounting for profits
2. Only the share of profits is liquid, transferable personal property.
3. W/o an agreement, there is: equal control, no right to salary, equal profits and losses.

Front 5

VA Agency & Patnership

Dissolution of partnership

Back 5

Without an agreement, notice of express will of one general partner to dissociate.

Front 6

VA Agency & Patnership

Partners liabilities to 3rd parties

Back 6

1. Similar to agency; general partners are liable for all partnership obligations.
2. Estoppel  person who represents a partnership is liable as if there was a general partnership.
3. Limited partners & Registered Limited Liability

Front 7

VA Agency & Patnership

Priority for distribution upon dissolution of the partnership

Back 7

Descending order:
1. All outside and inside creditors must be paid
2. Capital contributions by partners must be paid
3. Profits shared equally w/o an agreement (losses as well)

Front 8

VA Agency & Patnership

Will the Principal be vicariously liable if the agent gets help of a “sub-agent” and the sub-agent commits a tort?

Back 8

There can be no vicarious liability unless ABC (Assent, Benefit, right to Control)
- You will most likely not be able to prove this. A & C will be missing.
- NO VICARIOUS LIABILITY

Front 9

VA Agency & Patnership

Will a Principal who borrows another principal’s agent be vicariously liable for the borrowed agent’s tort?

Back 9

There can be no vicarious liability unless ABC (Assent, Benefit, right to Control)
- This is a much closer call than the “sub-agent”
- You will probably not have the right to control the borrowed agent.

Front 10

VA Agency & Patnership

Exceptions to the vicarious liability rule for independent contractor torts…

Back 10

1. Ultra hazardous activity (Hypo: brake repair at a gas stations)
2. Estoppel – if you hold out your independent contractor with the appearance of agency, you will

Front 11

VA Agency & Partnership

Scope of Principal-Agent Relationship factors

Back 11

1. Was the conduct “of the kind” agent was hired to perform?
2. Did the tort occur “on the job”? Frolic v. Detour
3. Did the agent intend to benefit the Principal? In VA, partial benefit is sufficient.

Front 12

VA Agency & Partnership

Exceptions to the Intentional Tort rule for Principal-Agent

Back 12

1. Authorized by the Principal
2. Natural
3. Motivated

Front 13

General Test for liability of principal for contracts entered by agents

Back 13

Principal is liable for contracts entered into by its agent if the principal authorized the agent to enter the contract.

Front 14

VA Agency & Partnership

Four types of AUTHORITY

Back 14

1. Actual express authority – actual authority can be oral and private, but it is narrowly tailored. In VA, if contract must be in writing then express authority must be in writing as well.
2. Actual Implied Authority – authority which agent reasonably believes the principal has given because of: necessity, custom, prior dealings.
3. Apparent Authority – a)Principal “cloaked” agent with the appearance of authority and, b)3rd Party reasonable relies on appearance of authority.
4. Ratification – authority can be granted after the contract has been entered, if: P has knowledge and accepts the benefits. Exception: Ratification cannot alter the terms of the contract.

Front 15

VA Agency & Patnership

May a limited partner cause the partnership to be dissolved or dissociate herself from the partnership?

Back 15

A limited partner can dissociate from the partnership by giving notice.

A circuit court may dissolve a limited partnership if it is no longer reasonably practicable to carry on the partnership biz.