Business Law Chapter 38

When a third party relies on a statement or action of the principal that creates a false appearance of an agent possessing authority this is referred to as _______ authority.

***actual*** undisclosed apparent respondeat superior

Even though an agent behaved in an unauthorized manner, the principal may ratify transactions by: _______ or _______. (Choose two correct answers)

***approving the transaction*** ***retaining the benefits of the transaction*** giving the agent apparent authority partially disclosing the agency

An agent's power to bind the principal in contract is through _______ authority which arises in one of two ways. (Choose all the correct answers)

***implied*** ***express*** ***actual*** undisclosed

An agent's liability to third parties in a contract hinges on whether the agency relationship is: _______. (Choose all the correct answers)

***undisclosed*** ***partially disclosed*** ***fully disclosed*** apparently disclosed

In a partially disclosed agency, who is liable to a third party for the obligations under a contract? (Choose the correct answer(s))

Both the principal and the agent.

In an undisclosed agency, who is liable to a third party for the obligations under a contract??

The agent.

When a third party relies on a statement or action of the principal that creates a false appearance of an agent possessing authority this is referred to as _______ authority.

apparent

When an agent acts in an unauthorized manner she may still bind the principal in contract based on _______ authority.

apparent

When a(n) _______ agent who enters into a contract with a third party, the principal is bound to the contract because because the third party may legally enforce the contract against the principal.

authorized

Under the negligent hiring doctrine, courts are especially inclined to hold employers liable in cases where: _______. (Choose all correct answers)

employees are entrusted with vulnerable populations employees have a high level of public contact

A _______ is an exception to the doctrine of respondeat superior because the conduct occurs when an agent, during a normal workday, does something purely for her own reasons that are unrelated to employment.

frolic

If the employees conduct is a small-scale deviation that is normally expected in the workday, it is not considered a ______ but rather a simple _____ which are within the ambit of respondeat superior.

frolic, detour

A(n) ________ occurs when a third party enters into a contract and is aware of the principal's identity, and knows that the agent is acting on behalf of the principal in the transaction.

fully disclosed agency

A bar would be _______ for the intentional torts of its bouncer because he serves the principal and is acting within the scope of employment.

generally liable

Many courts have adopted the _______ rule whereby employers are generally not vicariously liable for tortious acts committed by employees while on their way to and from work.

going-and-coming

Authority is _______ when the authority that is reasonably necessary to further the principal's objectives, or based on custom, or past dealings.

implied

Principals are generally not liable for the negligent acts of __________.

independent contractors

Generally, principals are not liable for the negligent acts of employees unless it involves _______ acts, and the principal has not taken reasonable steps under the ______ doctrine.

inherently dangerous, peculiar risk inherently dangerous, risk avoidance

Generally, employers are not liable for _______ torts committed at work, because the tort is outside the scope of employment.

intentional

A principal may face _______ liability for an agent's tort of negligence, even though the principal has not engaged in any wrongful conduct.

joint-and-several

A majority of states recognize that employers are liable under the tort of "_______" when the employer had reason to know that the employee might cause intentional harm within the scope of employment. (Choose two correct answers)

negligent hiring

For a principal to be vicariously liable for the acts of her agent, the conduct must have: _______

occurred substantially within the reasonable time and space limits been motivated by a purpose to serve the principal been related to her duties as an employee of the principal

If a third party knows an agent is representing a principal but does not know the actual identity of the principal, the agency relationship is a(n) _______.

partially disclosed agency

A CEO is referred to as a(n) _______ agent, and the C-level executives are _______ agents.

partially disclosed, subordinate disclosed, undisclosed ***superior, subordinate*** apparent, superior

Parties who suffer _______ losses as a result of another's negligence may only recover if those losses were a result of injury to person or property.

purely economic

An agent can obtain retroactive (after-the-fact) power to bind a principal through _______.

ratification

Liability for principals based on agents who are classified as employees is derived from the doctrine of _______.

respondeat superior

The doctrine of ________ does not apply if the employee's negligent misconduct results in harm only to reputation, or a purely economic loss.

respondeat superior

The doctrine of _______ is limited by a requirement that in order for a principal (employer) to be liable for the employee's tort, the act must have occurred within the employee's _______.

respondeat superior, scope of employment

The _______ rule is an attempt to place some limits on a principal's liability for the acts of its agent.

scope of employment

When an employee is commuting to or from work, the employer is shielded from liability because employees are said to be outside of the _______ during their daily commute.

scope of employment

C-level executives may be _______ agents if they _______ employees within their departments.

subordinate, hire and oversee

In a fully disclosed agency relationship, who is liable to a third party?

the principal

In a(n) _________ a third party is completely unaware of an agency relationship and believes that the agent is acting on her own behalf when contracting.

undisclosed agency

Under the doctrine of respondeat superior, employers are _______ liable for the negligent acts of employee agents.

vicariously