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Agency Law - Coggle Diagram

- - - - Prerequisites
        
        Principal Must have Capcity
        
        Principal Must Accept the Entire Transaction
        
        No Consideration Needed
        
        Principal Must Know Material Facts
      - Methods of Ratifiying
        
        Express Affirmance
        
        Implied Affirmance
        
        Silence
        
        Lawsuit
        
        Acceptance of Benefits
    - - General Rule
        If it is legal, it can be ratified.
      - Exceptions
        
        Withdrawal by Third Party
        
        Material Change of Circumstances
        If a change of circumstance changes equity, one may not ratify.
        
        Performance Illegal
        if illegal at the time of ratification, may not be ratified.
    - - Agent Relieve of Warrant Liability
      - COntract Given RetroActive Effect
        
        Incapacity
        Adopts rather than relates back
        
        Intervening RIghts
      - Principal Bound
    - - Majority Rule - Only Principal
      - In Most States "Undisclosed Principal" Cannot Ratify
        ONLY DISCLOSED
  - - - Agent with Present Actual Authority
        
        Position
        
        General vs. Speciall Agent
        General Agent involves continuity of service and has broader authority.
        
        General
        Authorized to do those things customary to such position.
        
        Secret Limiting Intructions
        Even if secret limiting instructions are given, the principal will be bound to the third party.
        
        Prior Acts
        Where a principal allows an agent to go beyond their scope of authority, and the third party is aware of this fact, the principal is bound by the agents acts.
      - Inherent Authority
        Sometimes the court will find agency even though there is no actual or apparent authority.
        
        Rationale
        To protect innocent third parties
        
        Examples
        
        Respondent Superior
        Liable if in the scope of employment, even if no actual authority.
        
        Conduct Similar to that Authorized
        If an agent goes beyond her duty, but is similar to the authorized act, the principal can be liable.
      - Agent with No Actual Authority
        
        Imposters
        Principal can be liable if he negligently permits an imposter to be in the position to act.
        
        Lingering Aparent Authority
        
        Writing Manifesting Agent's Authority
        If in writing, there will be apparent authority if relied upon.
        
        Death or Incompetancy
        The restatement view is that death or incompetence does not automatically terminate apparent authority.
        
        General Rule:
        The principal has the duty to notify third parties about the termination of an agency relationship. If not, the agent continues to have apparent authority and the principal can be liable.
        The test is whether the third party should have reasonbly known of the termination.
    - - Indicia of Ownership
        If principal gives agent the title, so it looks like they have the authority to transfer title, the agent has power to transfer, even if unauthorized.
      - Dealer of Goods
        Where a dealer of goods improperly sells principals good in the ordinary course of business, the third party takes title.
      - Just because an agent hold the good, does not give them the authority to dispossess or transfer ownership of said goods.
    - - Holding Out by Principals
        
        Inaction
        
        Affirmative Action
      - Reasonable Reliance by Third Party
  - - - Change of Circumstances
      - Breach of Agents Fiduciary Duty
      - Happening of Event
      - Unilateral Act of Principal or Agent
      - Lapse of Time
        
        Specified Time
        
        NonSpecified Time
        Reasonable Time
      - Law
    - - Definitions
        
        Agency Coupled with an Interest
        
        Power Given as Security
      - Restatment
        
        Purpose of Grant
        
        Considerations
    - - Express
        Authority Contained within the agreement whether written or oral, from P to A
        
        Express Authority Granted Mistakenly
        
        Express Authority Granted because of Misrepresentation
        Even if induced through misrepresentation, an agency relationship still exist.
        
        Construction of Authority
        
        Reasonable Belief of Agent
        
        Specific Vs. General Languange
        Specific will trump general
        
        Extravagant Language Usually limited
      - Implied
        
        Implied by Acquiescence (Failure to object)
        
        Impled because of Emergency or Necessity
        When there are no instruction during an emergency. Implied that agent may act reasonably.
        
        Implied from Custom and Usage
        
        Specific Situations
        
        Authority to Delegate
        Cannot delegate unless consented to
        
        Exceptions
        
        Delegation Required by Circumstance
        
        Custom
        
        Ministerial Acts
        
        Impossibility
        
        Authority to Purshase
        Authority to Purchase creates implied authority
        
        Authority to Pay
        Agent can pay for the good authorized the purchase.
        Can pay with principals funds or credit.
        
        Authority to Accept Delivert
        
        Authority to Sell
        
        Authority to Collect
        Cann only collect cash
        
        Authority to Deliver
        
        Authority to Warrant
        Can give general warranties that are customary
        
        Authority to Manage Investments
        
        Implied From Express Authority
  - - - Disclosed Principal Situation
        
        Disclosed Principal Liable
        
        Agent Generally Not Liable
        
        Intent of Parties
        if the intent of the parties is for the agent to have liability, the agent is liable.
        
        Agent's implied Warrant Authority
        Though an agent may not be liable for breach of contract, they may be liable to a third party for breach of implied warranty.
        Damages usually limited to direct damages.
      - Unidentified and Undisclosed Principal Situations
        
        Both Agent and Principal Liable
        
        Election to Bind Principal or Agent
    - - Disclosed Principal Situation - Principal Only May Enforce Contract
      - Unidentified and Undisclosed Principal Situations
        Either agent may enforce the contract and hold third party liable.
        
        Fraudulent Concealment (Exception)
        
        Increase of Burden to Third Party
    - - Rule
        If the agent had the authority, the principal is liable to third parties.
- - - - Employer-Employee by Estoppel
        
        When a principal creates the appearance that an employer/employee relationship exist, and a third party relies on this appearance, the principal may be sopped from denying the relationship and can be liable under respondeat superior.
      - Liability or Acts of Borrowed employees
        Liability is determined by who has control of the employee.
        Generrally no liability but if the borrowing principal directs the actions of the borrowed employee, they can be held liable for torts.
      - Liability for Acts of Subservants
        
        Implied authority to hire
        Creates Liability
        
        No authority to hire
        Generally, principal is not liable for unauthorized sub-servants.
        
        Express authority to Hire
        A resondeat superior relationship is created between principal and subservant.
      - Liability of Acts of Independent Contractors
        
        Selection of an Incompetent Independent Contractor
        If knowingly, principal is liable for agents actions
        If negligently selected, principal is only liable for their own negligent selection.
        
        Nondelegable Doctrine.
        When a principal assigns a nondelagable duty to an agent an the agent act negligently, the principal is liable for the independent contractors negligence.
        
        Inherently Dangerous Activity
        If dangerous, principal is liable.
      - Independant Contractor or Employee
        
        Contractors
        Principal has no control of the method of contractor
        
        Employee
        Principal has control of employees methods
    - - Motivation to Serve Employer
      - Intentional Torts
      - Frolic and Detour
        Time and Space Limitation
      - Ratifiaction
      - Authorization Not Required
- - - - No Consideration Required
      - Writing not required
      - Consent of Principal and Agent
        Both Principal and Agent must consent
    - - By Act of Parties
        Three Ways
        
        Hold Out
        (Apparent Authority)
        
        Previous Acts Unauthorized Acts through Ratifiaction
        
        Agreement
      - By Operation of Law
        
        Estoppel
        
        A principal may be estopped from denying the existence of agency. No different between this and ratification.
        Only difference is remedy.
        
        Statute
    - - The Capacity required if different for Principals and Agents
        
        Agent Needs Only Minimal Capacity
        Any person can be an agent, even minors. Must have minimal mental capacity
        
        Disqualification of Agents
        
        Representing Both parties
        Agent cannot represent both parties unless both parties fully agree.
        
        Not licensed
        If the law requires, and Agent must be license.
        Ex. Brokers, insurance agents
        
        Principal Must Have Contractual Capacity
        Generally, partnerships and business entities can be principals to appoint agents.
  - - - Liability of Agent to Subagent
        Agent will be liable for subagent, always.
      - Liability of Subagent to Agent
        
        General Rule: Subagent Liable to Agent
        
        Unauthorized Subagent
        If unauthorized subagent, subagent is not liable to principal.
      - Definition
        One who has been appointed by agent to perform the duties as the agent.
        Note the difference betweeen this and CoAgent
    - - Duties Imposed by Contract
      - Duty to Cooperate
        Principal must not interfere (Good Faith)
      - Duties Imposed By Law
        
        Reimbursement
        Must reimburse unless the loss is Agent's fault
        
        Compensation
        Must compensate reasonably unless agent is gratuitous.
        Principal has no duty to compensate subagent, unless agreemtn.
    - - Accounting
      - Withholding Compensation
        if and Agent commits and intentional tort, the principal may refuse to pay the agent for unapportioned compensation.
      - Action for Secret Profits
        Where an agent breaches a fiduciary duty and secretly profits, the principal may recover the profits.
      - Termination of Agency
        Breach of Duty allows agent to terminate agency
      - Action for Damages
        
        Torts - All agents
        
        Breach of Contract - Compensated Agents
    - - Breach of Contract
      - Agent's Lien
    - - Duty of Reasonable Care
        
        Gratuitous Agent
        Degree of Care customary in the community.
        Normally, the same as compensated.
        
        Duty to Notify
        Must disclose matter affecting the subject.
        Knowledge to the Agent is Imputed to the principal.
        
        Compensated Agent
        Must use reasonable Care
      - Duty of Obedience
        
        Agent must obey lawful instructions even if disagree.
        
        Interpretation of instruction must be reasonable. Determine by someone on a similar circumstance.
        
        Agent would be liable for losses due failure to follow difrection.
      - Duty of Loyalty
        
        Undivided Loyalty.
        Must disclose adverse interest to principal.
        Often happens when one is an Agent for principals with Adverse Interest
    - - Nonexclusive Contract (Contract Prior to Sale)
      - Exclusive Contract