Aware that the deal is with the principal not the

aware that the deal is with the principal, not the agent. For example, suppose a
sales engineer negotiates a purchase order for a customer to buy a large
quantity of optical lenses from her employer.
The lenses are delivered and the customer pays for them. Then the customer
claims that the lenses fail to meet the contract’s specifications and files a
lawsuit. Because the customer knew that the sales engineer was selling the
lenses on behalf of her employer and knew exactly who the employer was, the
company is liable and the agent is not.
What are some ways agents can ensure that third parties are aware of the
agency and of the principal’s identity?
Business cards listing the agent’s name and title and the principal’s
nameSignature blocks on e-mails and lettersName tags with titles and
identification badgesLetterhead stationaryCompany charge cards and company
checksSignature on contract, followed by title and company (as in “Philip
Tanzani, sales agent for The Beatrice Company”)
Tort Liability of Principal and Agent
What if the circumstances give rise not to contract liability, but to tort liability?
Is the principal liable to compensate an injured third party for a tort, such as
negligence? Is the agent liable?

A principal is also liable to third parties for tortious conduct the principal either
commits or directs the agent to commit.
Especially when the principal is a business, sometimes the principal’s negligent
conduct, typically negligent hiring or negligent supervision, leads to the agent’s
commission of a tort or a crime.
As with all negligence cases, foreseeability of risk is a key component. If the
agent is being posted to a job that requires entry to customers’ homes,
supervising children, working with infirm people, and so forth, then the level of
care required by the principal in hiring and supervising is correspondingly
higher.
Suppose instead the pizza parlor hired an excellent candidate as driver but
instructed her to exceed the speed limit regularly to deliver more pizzas and
deliver them faster. Again, although the driver was the direct cause of the
accident (and is personally liable), the pizza parlor is also liable for directing the
tortious conduct.
The principal has the opportunity to control the agent: to supervise him or her,
to develop good business policies and practices, etc. Therefore, in many
instances, the principal can minimize risks to third parties. Also, recall that
principals who must pay a third party might have insurance to cover the loss