Business Law Chapter 37
agent's act adverse to principal
3rd party must recognize if agent is doing acts clearly adverse to a principal
Duties and liabilities of an agent obedience and performance
Obedience and performance: must do what the principal specifies in the period specified. reasonable care: due to act with care of a reasonable person if an agent possesses a special skill such as a broker or attorney the agent must excercise his skill accounting: give all money to principal information: it is the duty of the agent to inform the principal about all facts relation to the principal's interest
Agency
a fiduciary, consensual relationship where an agent can act on behalf of, and subject to the control of a principal consensual goes both ways fiduciary is from the agent to the principal (trust) one person can make contracts in numerous places with many different parties at the same time as an agent
interest in subject matter
a form of agency in which the agent is given an interest matter in the property with which the agent is dealing.
special agent
agent authorized to carry out a specific transaction or definite business act
adverse acts of the agent
an agent acting adversely to the principal's interest is action outside fo the scope of authority and is in violation of fiduciary duties. if knowledge of an agent, payments to an agent, or statements to an agent are not imputed to the principal this is against relationship
interest in authority
an agent has been given or paid for the right to exercise authority.
Agency by ratification
an agent may attempt to do something not authorized by the principal but the principal can than authorize it a principal may explicitly improve or apply approval such as in the case of lowes intention to ratify may be found in words or conduct Calvin moving his things to storage space
incidental authority
authority of an agent that is reasonably necessary to execute express authority if the principal tells the agent to buy stuff without giving them money there is implied incidental authority that they are purchasing the stuff on credit
customary authority
authority of the agent to do any act that according to the customs of the community usually accompanies a transaction for which the agent is authorized (giving a receipt)
general agent
authorized by the principal to conduct all affairs related to a certain type of business or at a particular business location general manager of a store
universal power of attorney
authorized by the principal to do all acts that can be lawfully delegated to a representative military absence- blanket power of attorney
*3rd party must know two things
does the agency exist what is the nature and scope of the authority
disabilities under uniform durable power of attorney act
durable powers of attorney grant only those powers specified in the instrument to disability or insanity must be written
four types of agency authority
express, incidental, customary, apparent
responsibility for proving identity of agent
falls on the third party because they are the ones benefiting from the transaction
public identity
if the public identity of an individual contractor is concealed so that the public believes that it is dealing with a principal, the principal is liable as though the contractor was an agent/employee.
reasons for termination
insanity, bankruptcy, destruction of subject matter, countries at war with one another, death
employ versus agent
most agents are employees but most employees are not agents agents can enter into contracts while normal employees cannot bind companies to contracts
contracts
once a contract is entered into the principal is bound to the third party and the agent has nothing to do with it
apparent authority
only the appearance of authority, but no actual authority objective test based on the principal's outward manifestation through words and conduct mere placing property in the possession of another does not give authority or apparent authority
duties and liabilities of principal to the agent
perform contract compensate for agent's services repay losses reimburse for expenditures can't give duties to another agent at same time
express authorization
principal tells agent to do something orally or in writing a person is appointed to act for or on behalf of another person authorization of an agent to perform a certain act to have interests or right to dispose of land the express authorization must be in writing.
three types of agency
special agency general agency universal -power of attorney agency
double transactions
the agent cannot act on behalf of both parties double status can void transactions agents cannot receive commissions or gifts from a third party
termination of agency coupled with an interest
the agent has an interest in the property they are dealing with, it cannot be given to another agent an agency that cannot be revoked by the principal before expiration of interest not terminated by death or insanity
for intention to become ratification
the agent must have acted on behalf of the principal the principal must have been capable of authorizing act at time of act and ratification the principal must have knowledge of all material facts when a principal ratifies an unauthorized person's act they are no longer liable for acting without authorization
uniform durable power of attorney
the power of attorney only has as much power as the original principal designated does not go into effect until the person is disabled or insane
law of unregulated market place
there is no duty to tell customers the real price of things at a garage sale in a regulated market there is a duty fiduciary: high duty of full disclosure
secret limitations
third parties are not bound by secret limitations that they have no knowledge of
power of attorney
written authorization to an agent by a principal to act on legal or financial matters attorney in fact: agent authorized to act under power of attorney difference because cannot act if the principal is incapacitated.
*Authority and Power are not the same thing
you always have the power to terminate agency but it can be wrongly terminated in which case you owe damages to the principal
agency of estoppel
you are held responsible for your actions and conduct no legally bound agent to principal there just appears to be an agent. if you act like something is true you will be held responsible for it. german restaurant an agency that is not created as an actual agency by a principal and an agent but that is imposed by law when a principal acts in such a way as to lead a third party to reasonably believe that another is the principal's agent and the third party is injured by relying on and acting in accordance with that belief
repeating transactions postagency transactions
you as an agent get some sort of compensation for repeated transactions that you originally initiated only given post agency transactions when it is called for
indepentdent contractors
you do not have "the right to control" them and are not liable for thier torts the principal does not care about the process they only care about the results the principal does not provide work place or tools you don't supervise or control their hours if you are a small business owner it is better to hire independent contractors because you do not have to provide insurance or benefits to them