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