ACCT%203151%20Business%20PP9

ACCT%203151%20Business%20PP9 - Are the following acts of...

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Unformatted text preview: Are the following acts of the estate agent OK or not? Selling the flat of his principal to his family member at a low price without telling the principal his relationship with the purchaser ( vs. the rule of full disclosure of any personal interest in the transaction) Accepting commission from the purchaser without telling the principal (vs. the rule of no acceptance of secret profits) A typical case involving disputed transactions done by an agent Principal Legal action? appointment Agent (unauthorized transaction) Third party Can a principal refuse to accept an unauthorized transaction done by his agent on his behalf? 2 factors to determine: The higher the ranking of an agent, the more authority he would appear to have. Can the third party know that the transaction had not been authorized by the principal? The second factor can override the first one. When would an agent be liable for the amount stated in a cheque? Example 1: Peter, for and on behalf of CUHK Example 2: Peter (omits to state `for and behalf of Chinese University of Hong Kong') Example 3: Peter, for and on behalf of Chinese Polytechnic of Hong Kong ...
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This note was uploaded on 02/04/2012 for the course ACCT 3151 taught by Professor Martinko during the Spring '11 term at CUHK.

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