Agency Case Study

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Register to read the introduction… Will occur where it is reasonable to infer from all the circumstances that the parties have conducted themselves in such a way that a principal-agent relationship exists: Norwich Fire Insurance Society Ltd v Brennans (Horsham) Pty Ltd [1981] * Agency may be created by Estoppel: Pole v Leask [1861-73]: * Elements for establishing agency by estoppel: * a representation by the supposed principal to the effect that the supposed agent is the principal’s agent * a third party has relied on such representation * it was reasonable in the circumstances that the 3rd party rely on the representation * there has been an alteration in that 3rd party’s position as a result of reliance upon the representation * Agency may be created by necessity: agent by necessity must act reasonably and prudently in the circumstances: China-Pacific SA v Food Corporation of India [1981] AND Sachs v Miklos [1948]  not an agent my necessity * Agency may be created by cohabitation (wife/husband) The Agent’s Authority:

* Actual
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* Is an issue where the agent exceeds his/her actual authority (both express and implied) * Three requirements must be shown for ostensible authority: * The ‘holding out’: a representation was made to the third party that the agent had the authority to engage in activity of the kind that occurred, on behalf of the principal. * A person with ostensible authority cannot create ostensible authority in another: Freeman & Lockyer v Buckhurst Park Properties Ltd [1964] * The third party must have been induced by such ‘holding out’ to act upon it – reliance: same case as above * Cases on ostensible authority: o Heperu Pty Ltd v Morgan Brooks Pty Ltd [2007] * First Energy (UK) Ltd v Hungarian International Bank Ltd [1993] Principal may ratify agent’s unauthorised acts: * Ratification: involves the principal’s (retrospective) adoption or approval of the agent’s actions * Rules applying to

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