BL-Chapt32 - Print Chapter Page 1 of 24 Liability to Third...

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Liability to Third Parties and Termination Chapter Introduction 32-1 Scope of Agent's Authority 32-1a Express Authority 32-1b Implied Authority 32-1c Apparent Authority and Estoppel 32-1d Emergency Powers 32-1e Ratification 32-2 Liability for Contracts 32-2a Authorized Acts 32-2b Unauthorized Acts 32-2c Actions by E-Agents 32-3 Liability for Torts and Crimes 32-3a Principal's Tortious Conduct 32-3b Principal's Authorization of Agent's Tortious Conduct 32-3c Liability for Agent's Misrepresentation 32-3d Liability for Agent's Negligence 32-3e Liability for Agent' Intentional Torts 32-3f Liability for Independent Contractor's Torts 32-3g Liability for Agent's Crimes 32-4 Termination of an Agency 32-4a Termination by Act of the Parties 32-4b Termination by Operation of Law Chapter Recap Page 1 of 24 Print Chapter 2010-8-30 ..
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Chapter Introduction As discussed in the previous chapter, the law of agency focuses on the special relationship that exists between a principal and an agent–how the relationship is formed and the duties the principal and agent assume once the relationship is established. This chapter deals with another important aspect of agency law–the liability of principals and agents to third parties. We look first at the liability of principals for contracts formed by agents with third parties. Generally, the liability of the principal will depend on whether the agent was authorized to form the contracts. The second part of the chapter deals with an agent's liability to third parties in contract and tort, and the principal's liability to third parties because of an agent's torts. The chapter concludes with a discussion of how agency relationships are terminated. Page 2 of 24 Print Chapter 2010-8-30 ..
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32-1 32-1a Scope of Agent's Authority Express Authority Power of Attorney The liability of a principal to third parties with whom an agent contracts depends on whether the agent had the authority to enter into legally binding contracts on the principal's behalf. An agent's authority can be either actual (express or implied) or apparent . If an agent contracts outside the scope of his or her authority, the principal may still become liable by ratifying the contract. Express authority is authority declared in clear, direct, and definite terms. Express authority can be given orally or in writing. In most states, the equal dignity rule requires that if the contract being executed is or must be in writing, then the agent's authority must also be in writing. Failure to comply with the equal dignity rule can make a contract voidable at the option of the principal . The law regards the contract at that point as a mere offer. If the principal decides to accept the offer, the acceptance must be ratified, or affirmed, in writing. Assume that Pattberg (the principal) orally asks Austin (the agent) to sell a ranch that Pattberg owns. Austin finds a buyer and signs a sales
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This note was uploaded on 10/12/2011 for the course ACCT 362 taught by Professor Mint during the Fall '11 term at CUNY Queens.

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BL-Chapt32 - Print Chapter Page 1 of 24 Liability to Third...

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