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19 Cards in this Set

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In an agency relationship involving two parties, one of the parties, called the agent, agrees to represent or act for the other, called the principal.


Refers to a person having a duty created by his or her undertaking to act primarily for another's benefit in matters connected with the undertaking.

Fiduciary relationship

The relationship involves trust and confidence

Independent contractor

Those who hire them have no control over the details of their work performance

Agency by agreement

The agent will act for the principal in that the principal agrees to have the agent so act

Agency by ratification


The agent has the duty to act solely for the benefit of his or her principal and not the interest of the agent or third-party.

Principles duties to the agent

Compensation, reimbursement and indemnification, cooperation, safe working conditions

Agents duties to principal

Performance, notification, loyalty, obedience, accounting

Express authority

Authority declared and clear, direct, and definite terms

Equal dignity rule

Requires that is the contract being executed is or must be in writing, and agents authority must also be in writing

Implied authority

What an agent has to do what is reasonably necessary to carry out express authority and accomplish the objectives of the agency.

Apparent authority

What an agent has been the principal, but either word or action, causes a third-party reasonably to believe that the agent has authority to act, even though the agent has no express or implied authority.


Occurs when the principalaffirms, or except your possibility for, and agents unauthorized act.

Disclosed principle

The principal whose identity is known by the third-party at the time the contract is made by the agent

Partially disclosed principle

A principal whose identity is not known by the third-party

Undisclosed principle

A principal whose identity is totally known by the third-party

Respondeat superior

A Latin term meaning let the master respond and is a principal may also be liable for harm that his or her agent causes to a third-party

Vicarious liability

The employer is liable for torts committed by an employee acting within the course and scope of employment