Agency

To establish a principal's liability under the doctrine of respondeat superior, two basic elements must be established:

(i) an employer-employee relationship, and (ii) conduct within the scope of employment.

There are two types of agency relationships that may not be unilaterally terminated by the principal (and that generally are not terminated by operation of law): where

(i) the agent has an interest in the subject matter of the agency, or (ii) a power is given for security.

All of the following are examples of actual authority granted by a principal to an agent:

A principal has failed to object to a series of an agent's unauthorized acts, reasonably leading the agent to believe that she has authority to do those acts in the future; An agent employs a subagent to execute ministerial acts; A principal conveys authority to his agent to purchase a piece of property that the principal did not actually intend to purchases

Which of the following is true of a principal's duty to compensate an agent or subagent?

A principal owes an agent a duty to reasonably compensate her for services rendered.

Implied actual authority is the authority:

An agent believes she has based on her communications and relationship with the principal.

In the agent-subagent relationship

An agent will be held liable to the principal for breaches of the subagent

An employer will be held liable for his employee's torts where

An employee driving the employer's vehicle within the scope of employment negligently causes an automobile accident

What elements are required to establish a principal's liability under the doctrine of respondeat superior?

An employer-employee relationship and conduct within the scope of employment.

_____ authority results in a situation whee a principal limits the actual authority of his agent to act, the action acts beyond the scope of that limitation, and a third party with whom the agency dealt was unaware of the limitation.

Apparent

____________________ is created where a principal holds another out as his agent to a third party.

Apparent authority.

A principal gives his agent authority to enter a contract with a third party. The agent discloses to the third party that a principal exists, but does not disclose the principal's identity. Who can be bound to the contract?

Both the principal and the agent.

Who can be bound on a contract when the principal is undisclosed to the third party and the agent had authority to enter the contract?

Both the principal and the agent.

There are situations where a person will purport to act on behalf of another without any type of authority. In such a situation, the principal may still be bound by the agent's act if the principal subsequently ratifies the agent's act. All of the following are required on the part of the principal for him to ratify an agent's act:

Capacity; Knowledge of material facts; Acceptance of the entire transaction.

Unless otherwise agreed, a principal owes an agent a duty of:

Compensation.

Which of the following is required to create an agency relationship?

Consent by both the principal and the agent.

A minor deviation from an employer's directions, also known as a ____________________, generally falls ____________________ the scope of employment.

Detour; within.

Which of the following is a duty implied by law that an agent owes to a principal?

Duty of loyalty; Duty of obedience; Duty of reasonable care.

The type of actual authority contained within the four corners of an agency agreement is:

Express authority.

A major deviation from an employer's directions, also known as a ____________________, falls ____________________ the scope of employment.

Frolic; outside.

If a principal negligently selects an incompetent independent contractor, the principal will be liable to the injured third party for:

Her own negligence in selection.

Where a general agent exceeds her actual authority (i.e. violates orders) but the act performed is similar to the act authorized, the principle will be held liable

Inherent authority

A principal will be bound by the agent's acts where the principal:

Places the agent in a position that carries with it certain customary responsibilities, and the agent acts in accordance with such customary responsibilities without the actual authority to perform the acts; Has previously allowed the agent to act beyond her authority and the principal knows that a third party is aware of this; Negligently permits an imposter to be in a position where the imposter appears to have authority to act for the principal.

The fact that the agent has possession of the principal's goods does not entitle the agent to sell them or transfer good title. For the possessor of goods to be able to transfer good title without authority, she must have either

Some indicia of ownership or be a dealer in the goods

If an employer lends the services of her employee to another and the employee commits a tort while performing in his loaned role, who is liable?

The loaning principal, if the employee remains under the right of control of the loaning principal.

A person is disqualified from being in agent when.

The person is an insurance agent and her license has been suspended

Who can be bound to a contract when the principal's identity is disclosed to the third party and the agent had authority to enter the contract?

The principal and, if the parties intended the agent to be a party to the contract, the agent.

Which of the following parties must have contractual capacity to enter into an agency relationship?

The principal.

The existence of apparent authority usually requires:

The reasonable belief by a third party that the agent had authority to act.

All of the following are duties owed by an agent to a principal:

To carry out the agency with reasonable care.; To obey all reasonable directions of the principal; To notify the principal of all matters that come to the agent's knowledge affecting the subject of the agency.

What is the primary overriding factor in determining whether a person is an employee?

Whether the principal has the right to control the manner and method of performance.

A principal may hold out another as possessing authority, inducing a third party to reasonably believe authority exists, by all the following means:

Words stated by the principal; Conduct on the part of the principal; Inaction on the part of the principal.

An agency relationship can be terminated when...

ending the agency relationship would cause a breach of contract; a third party would be adversely affected by the termination; the purpose of the agency has not been completed.

An agent with authority to sell a principal's property

may give general warranties for qualitiy

An employer will be liable for an employee's intentional trots

that result from friction naturally engendered by the employer's business