Business Law: Agency
Agency by ratification
A person can agree to be an agent through a third party as long as the principal is then notified and approves the agreement, an agency relationship is formed.
How is an agency relationship formed? (4)
Agency by agreement " " ratification " " estoppel " " operation of law
Agency by agreement
Both the principal and the agent agree on certain conditions. This agreement can be formed either by an express or implied contract.
Agency by estoppel
If a third party believes that another person is the principal's agent when in in fact they are not, the principal is estopped to deny the agency relationship.
Duties of agent to principle (5)
Loyalty & obedience -act on behalf of and be subject to the control of the principal and act within the scope of power delegated by the principal Reasonable care - discharge his or her duties with appropriate care and diligence, avoid conflict of interests with the principal Accounting - promptly hand over to the principal all monies collected on principal's behalf. Confidentiality
Agency by operation of law
Sometimes in emergency situations courts will step in and deem a person to be an agent even if there was no agency agreement to prevent a party from suffering injustice.
Agency
This is fiduciary relationship in which an agent agrees to perform a task for the principal and acts on his behalf, However, subjected to the principal's control.
Duties of principal to agent (CRIC)
To compensate the agent an agreed amount of compensation after they have completed their tasks. To Reimburse the agent of any money spent while under the principle's service. To Indemnity the agent for all losses they may have incurred in conducting the principles business. Duty to cooperate - cannot unreasonably interfere with the agent's ability to accomplish his task
Completion
agency is automatically terminated when the purpose for which the agency was created is achieved
enemy of state
if the P or A is a citizen of a another country and a war breaks out it would be illegal to continue the agency
expiry of time
if the agency was created for a specified time when that times come the agency comes to and end
death
if the principal or agent dies the agency is terminated automatically
Termination of agency (9)
revocation renunciation by completion of agreed purpose expiry of time death insanity insolvency destruction of subject matter becoming enemy of the state
Revocation
the principle revokes the authority of the agent at any time
destruction
when an agency is createdd with reference to a particular property or subject, if it is destroyed the agency is terminated
Renunciation
when the agent no longer wishes to continue working as an agent, must give notice in advance otherwise he may be liable to compensate the principle
insolvency
when the principle becomes...