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Agency (Authority (Ratification Authority: An agent acts without…

- - - - Principal knows, or should have known, all material facts at time of affirmance
      - Principal accepts entire transaction
      - Principal has capacity (competent & legal age) [Exam tip - do not discuss, unless facts suggest it is an issue]
      - No consideration required [Exam tip: Do not discuss unless facts suggest consideration is an issue, e.g. a defense asserted is lack of consideration]
    - - Express
      - Implied
        
        Silence when a duty exists to disaffirm, or
        
        Principal brings a lawsuit involving the transaction
        
        Accepts benefits of transaction when still possible to decline them, or
  - - - Reasonable reliance by a third party
      - Actions of the principal
        
        Inaction by the principal when there is a duty to act (e.g. to correct a statement by the "agent," made in his presence)
        
        Affirmative action of the principal by word or conduct
    - - Agent exceeds actual authority: Agent previously exceeded & Principal is aware that 3d party knew of this fact
      - Lingering authority: An agent will continue to have authority as to a third party when the principal fails to notify a party, who knows of the agency from prior dealings (unless the agency knows or should have known of the termination
      - Imposters: Principal's negligence leads a 3d party to believe the imposter has actual authority
      - By position: An agent will have apparent authority to perform customary responsibilities for the position to which principal assigned him; secret limiting instructions do not limit the apparent authority vis-a-vis a third party
  - - - Extension of express authority: authority to use means reasonably necessary to carry out express grant
      - Custom and Usage known to Agent
      - Acquiescence - principal's acceptance or failiure to object to a series of unauthorized acts that reasonably lead thh agent to believeshe has the authority to continue similar acts
      - Emergency or necessity
      - Delegation - generally not permitted
        
        Exception: Ministerial acts
        
        Exception: delegation necessary because of circumstances/impossiblity (e.g. contractor may delegate authority to hire electrician), or custom of particular business,
    - - Specific language governs over general
      - Express authority is effective, even if granted based on a misrepresentation or mistakenly to an unintended agent
      - Extravagant language is interpreted conservatively
- - - - Agent is liable; generally the third party may elect which of agent/principal to bind
    - - Agent is liable; generally the third party may elect which of agent/principal to bind
    - - Agent is generally not bound
      - Exception: Parties intend the agent will be liable
      - Exception: Agent's implied warranty of authority - agent is liable for actions taken "on behalf of principal" without authority
  - - - Principal, but not the agent may enforce the contract
    - - Either principal or agent may enforce; principal is entitled to benefits
      - Exception: Fraudulent concealment of principal - principal may not enforce & third party may have the right to withdraw (affirmative misrepresentation)
      - Exception: Increased burden to third party (e.g. a requirements contract - the requirements of a mom-and-pop store (agent) are considerably less thatn the requirements of Walmart (principal)