scope of agent's authority
liablity of principal to third parties w/ whom agent contracts depends on agent's authority to enter into legally binding contracts on principal's behalf
Authority can be
1. actual (express or implied), arises from what principal makes clear to the agent,
actual authority: express authority
authority declared in clear, direct, and definite terms. can be given orally or in writing
express authority: equal dignity rule
requires that if contract being executed is or ust be in writing, then agent's authority must also be in writing
--> failure to cokply can make contract voidable at option of the principal
EXCEPTIONS:
1. executive officer of corporation normally can condu
express authority: power of attorney
written doc, usually notarized (signature, date, imprints by notary public) that conveys express authority
actual authority: implied authority
agent has implied authority to do what is reasonably necessary to carry out express authority and accomplish objectives of agency, can also be implied by custom or inferred from agent's position
apparent authority
agent has apparent authority when the principal, either by word or action, causes third party reasonably to believe the agent has authority to act, even though agent has no express/implied authority
can occur via
1. principal's pattern of conduct over tim
emergency powers
when unforseen emergency demands action by agent to protect/preserve property and rights of priincipal, but agent unable to communicate w/ principal, agent has emergency power
ratification
when principal affirms/accepts responsibility for an agent's unauthorized act --> principal bound to agent's act, act treated as authorized by principal from the outset.
either express or implied
If principal does not ratify contract, principal is not bou
liability for contracts
liability for contracts formed by agent depends on 1) how principal is classified, 2) whether actions of agent were authorized/unauthorized
disclosed principal
principal whose identity is known by third party at time contract made by agent
partially disclosed principal
third party knows agent is/may be acting for principal at time contract is made, but principal identity is unknown
undisclosed principal
principal whose identity is totally unknown by third party, third party does not know agent is in principal-agent relationship
liability for contracts: authorized acts
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