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Agency (Torts (3rd Party v. Principal (Agent is employee (Respondeat…

- - - - Respondeat superior: Doctrine imposes vicarious liability upon a principal for the torts his agent commits in the scope of employment.
        
        • Agent performs tasks assigned by the employer or
        engages in a course of conduct subject to employer’s control.
        
        • Serves employer’s purposes.
        
        • Employer is not liable if the employee substantially
        deviates from the authorized route (frolic).
        
        Employee can return to the scope of the employment after a frolic.
        
        • Employer is still liable for slight deviations (detour).
      - Employer’s liability is in addition to the agent’s liability.
      - Employer and employee are jointly and severally liable.
      - Strict liability doctrine, so no defenses.
    - - General rule: No liability.
      - Exceptions:
        
        • Inherently dangerous activities: nature and circumstances of the
        work to be performed are such that injury to others will probably result unless precautions are taken.
        
        • Nondelegable duty.
        
        • Loaned agent.
        
        • Negligent selection of contractor.
  - - - • Duty of Care.
      - • Duty of Obedience.
      - • Duty of Loyalty.
        
        • No self-dealing.
        
        • May not usurp a business opportunity belonging to the principal.
        
        • Duty not to compete.
        
        • No dual agency.
      - • Duty to Account.
- - - - Principal may not interfere with the agent’s performance.
      - Principal must affirmatively aid where reasonably required to do so.
  - - - Fully disclosed principal: Agent is not liable in contract.
      - Undisclosed principal: Agent is personally liable in contract.
      - Partially disclosed principal: Agent is personally liable in contract.
        
        When the third party learns the identity of the principal, the third party must elect to go after either the agent or principal, but not both.
      - Breach of warranty of authority: Agent acts beyond her authority on behalf of a principal. Agent is personally liable.
  - - - • Actual: Manifestation of the principal to the agent that the agent acts for the benefit of the principal in a particular way and that the principal agrees to be bound by the agent’s actions.
        
        Express: Principal directly requests the agent to act.
        
        Implied:
        
        Authority to accomplish the principal’s express request;
        
        Things the agent believes the principal wishes him to do based on his reasonable understanding of the principal’s expressed request.
      - Apparent: The agent is “cloaked” with authority.
        
        Third party reasonably believes the agent has authority to act on behalf of the principal
        
        Belief is based on the principal’s representations made to the third party.
      - Ratification: Principal grants retroactive authority for his agent’s earlier unauthorized actions.
        
        Ratified act must be one that the principal could have authorized at the time of the act.
        
        Once ratified, an act has the same effect as if it were originally done with authority.
- - - - • Written.
      - • States place, date, hour, and purpose of meeting.
      - • No less than 10 and no more than 60 days prior to the meeting.
      - • Notice can be waived.
    - - • Dissenting shareholder must file a written objection to the proposed action before the shareholders’ vote.
      - • Dissenter must not vote his shares in favor of the proposed action.
      - • If corporation and dissenter fail to agree as to the value of the stock, the court makes a determination of value.
- - - - • Not automatic.
        • Must be in Articles of Incorporation.
    - - • Shareholder has no inherent right to be paid a dividend.
        • Board of directors has discretion to decide whether and when to declare a dividend.
- - - - May contrarily contend in agreement.
- - - - Express.
      - Apparent: based on the nature and course of business.
      - Restrictions: Third party must know about restrictions on authority or the partnership will be bound.
      - Partner who acted without authority may be liable for breach of the partnership agreement.
- - - - • For a specific undertaking.
      - • For a term.
      - • At will.
  - - - General partners: manage the business and are personally liable without limitation for partnership obligations.
      - Limited partners: contribute capital and share in profits, but take no part in the control or management of the business, and whose liability is limited to their contributions.
    - - Filing a certificate of limited partnership with the Secretary of State.
      - Must have at least one general partner and at least one limited partner.