Corporation – Outline www.swapnotes.comPage 1 of 30 Professor Engler Fall 2005 AgencyA.3 requirements to establish agency:a.Manifestation by principal that agent will act b.Acceptance by agent of the undertaking c.An understanding b/t the parties that principal will be in control of the undertaking B.Agent may bind the Principal a.Liability of the Principal to 3rdParties in Contracti.(Actual) Authority-Express and Implied1.Mill Street Church of Christ v Hogan- Church hired Bill to paint and hire Petty if need help. Bill hires brother Sam and Sam gets hurt. Church had to pay worker’s comp b/c Bill had implied authority to act (Petty unavailable and in the past, church allowed Bill to hire Sam) a.Restatement of Agency-Section 26-Creation of Actual Authority-can get authority to act by written/spoken word or by actions of the principal that the agent reasonably determines means the principal gave him authority to actÆprincipal acts in a manner that leads agent to believe he has authority to act. ii.Apparent Authority-an agent has apparent authority sufficient to bind the principal when the principal acts in a manner as would lead a reasonably prudent person to suppose the agent had the authority he purports to exercise1.370 Leasing Corp v Ampex Corp-370 made K to buy from D w/ D’s employee who didn’t have authority to make deal. D is bound by the K. a.Restatement of Agency Section 27-Creation of Apparent Authority-similar to section 26, but 3rdparty believes the agent has authority, but the agent himself doesn’t necessarily think so b.Apparent Authority creates a tension b/t protecting 3rdparties and holding a co to a K it never would have entered into. c.D could’ve trained employees better or documented pp who have authority. 370 could’ve made sure person had authorityiii.Inherent Agency Power-principal is liable for all the acts of the agent which are within the usual authority of such an agency. Restatement Section 194-1951.Watteau v Fenwick-Manager authorized to buy bottled ales and mineral waters, but buys cigars and disappears. P sues principal. J/P. iv.Ratification-acceptance of the prior act that wasn’t authorized at the time, but becomes valid when principal finds out. (Restatement Section 82)1.Botticello v Stefanowicz-H&W are TIC. P deals w/ H. W wont sell for less than $80k. H leases to P w/ option buy for $75.Deal not valid b/c H wasn’t W’s agent since no manifestation and no ratification by W. v.Estoppel 1.To win on Estoppel, P needs to show: a.Principal through intentional or negligent words, acts etc creates the appearance of authority in the purported agent b.3rdparty reasonably and in good faith acts in reliance c.3rdparty changes position relying on appearance of authority 2.Hoddeson v Koos Bros.- P gives “sales clerk” $ for furniture to be delivered. No receipt. Not delivered. P suing for $ back. No apparent
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