Chapter 20 Homework Assignment (BAS 267)

Which of the following forms of agency relationships is established when a principal leads a third party to falsely believe that another person is acting as her agent?

Apparent agency

Artie tells Brock, his cook, to buy 100 steaks; Brock, however, orders 1,000 steaks. Artie becomes aware of Brock's actions but does nothing to fix the order and thus accepts the order as placed. In this situation, who is liable?

Artie could be liable for the steaks because of ratification

Which of the following is not a possible remedy a principal can seek when an agent breaches a contract?

Committing a tort against the agent in retaliation.

______________is a document that states either the power of the agent is to continue to be effective if the principal becomes incapacitated or the power of the agent is to take effect after the principal has become incapacitated.

Durable power of attorney

Which of the following is not a principal's duty to an agent?

Duty of performance.

___________________ to create an agency.

No formalities are required

A(n) _______________ is a special kind of agency relationship created for the agent's benefit, not the principal's.

agency coupled with an interest

An agent's duty to inform and account requires the agent to

do all of these things.

An agency is a _________________.

legal relationship

Which of the following acts would result in a principal's being held liable in tort regardless of whether an agent was acting in the scope of his or her employment?

Agent misrepresentation.

Which of the following is not a question the courts use to determine employer liability under the doctrine of respondeat superior?

All of these questions help the court determine the extent of the principal's liability.

Which of the following is not a way to terminate an agency relationship by operation of law?

Renunciation by the agent.

Ricky is Jonah's boss. Before he goes on vacation, Ricky gives explicit instructions to Jonah not to buy any more shipments of ink cartridges because the company has enough to last them through the year. While Ricky is out of town, Jonah discovers an amazingly cheap deal for inkjet cartridges, and places a large bulk order for the company because the deal was too good to pass up. What are Ricky's options in this situation?

Ricky can sue Jonah for breach of contract and recover damages because Jonah did not follow orders.

For agency by ratification to be effective, which of the following is not required?

The principal must ratify the agent's act within 30 days of the creation of the contract.

If an agency relationship is terminated, ___________ must be given to third parties who have had business interactions with the agent.

actual notice

Sam hires several students to deliver flowers for his florist business. Within the scope of one of the students' deliveries, one student has discovered a way to commit check fraud to receive more funds from the delivery of the flowers and commits a tort in the process. Sam does not condone this behavior, but he is aware of the check fraud and allows it to happen. Is Sam liable?

Yes, the principal is liable for the agent committing a tort knowing that the agent acted illegally.

Roger is currently in the hospital, having been diagnosed with terminal cancer. Roger would like Kim, a close friend, to make any health decisions for him in the future if he is ever incapable of making such decisions for himself. Roger would be wise to enact

a durable power of attorney.

Suppose Claude contracts Gerard (an antique dealer) to act as his agent to sell an antique journal from the 1800s he found in his grandfather's trunk. Claude authorizes Gerard to sell it for $500. However, in the course of showing the journal to several potential buyers, Gerard learns that the journal was written by Abraham Lincoln as a child. Because the journal is worth much more than $500, ______________________________________.

the agency relationship would probably be terminated due to changed circumstances

An agent is entitled to compensation for his services from the principal _____________________.

unless the parties have agreed the agent will act gratuitously

Under the principal of ___________, a principal can be assigned liability without fault for any harm an agent/employee causes while working for the principal.

vicarious liability