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18 Cards in this Set

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  • Back

Fiduciary relationship created when two parties manifest the intention that the agent will act on the principal’s behalf and subject to the principal’s control

of agency
No writing or other formality required unless required by statute

Oral appointment of agent is OK

Consent of both parties required to create AND continue relationship

Contractual capacity required of principal ONLY
Agent's fiduciary duties to principal

Loyalty: includes avoiding secret profits, conflicts of interests; remedy for breach is construct trust of any gains

Obedience: must follow reasonable instructions from principal

Reasonable care: reasonable under the circumstances
Principal's fiduciary duties to agent
Reasonable compensation

Reimbursement of expenses

Cooperation with agent's efforts
Types of agent/principal authority
Actual (express, implied)

Apparent authority

Ratification of unauthorized act

actual authority
What agent reasonable believed based on principal's statements/conduct

Express actual authority: based on principal's words

Implied actual authority: based on reasonable inferences from principal's statements or conduct
Depends on what's in mind of agent

Can terminate by express terms, drastic change in condition, operation of law
Termination of actual authority
Can terminate actual authority by express terms, drastic change in condition, operation of law (death/insanity/bankruptcy/dissolution)

apparent authority
Depends on what is reasonably in mind of THIRD PARTY, based on conduct/statements of principal
Ratification of authority
Approval by principal of agent's action, after the fact, where "agent" had no authority
Agent's liabilities to 3rd parties (4 types)
Fully disclosed agency

Partially disclosed


Breach of warranty of authority
Fully disclosed agency liability to agent
Agent not personally liable to 3rd parties executed on behalf of principal, provided 3rd party knew agent was acting on behalf of principal and knew IDENTITY of principal
Partially disclosed agency liability to agent
3rd party knew agent was acting on behalf of principal, but did not know IDENTITY of principal

Third party can bind either agent OR principal
Undisclosed agency liability to agent
3rd party did not know person contracting with was an agent

Third party can bind either agent OR principal

breach of warranty of agency authority
Agent's representation to 3rd party that she is acting on behalf of principal is deemed a promise/warranty - breach can lead to liability of agent
Respondeat superior
Employers are vicariously liable for torts committed by employees acting within scope of employment

Doctrine does NOT cover independent contractors

Depends on facts relating to employer's right to control time, place, manner, etc. of work

More control means it is more likely there is employer/employee relationship
Scope of employment and tort liability (2 types)
Scope of employment is conduct at direction of employer OR conduct motivated to serve employer

Detour: minor and reasonable deviation from assigned routs or tasks - generally considered within scope

Frolic: major deviation, especially for self-serving task - generally NOT in scope
Intentional tort liability on employer
Not within scope of employment; might have liability nonetheless if employer receives benefit from tort