Agency Mini Outline

Liability in K- principal becomes liable to 3rd party thru actions of his agent if (1) both agent and principal consent and (2)agent is subject to principals control Actual authority: express or implied (Ps conduct leads A to believe A has authority) - Can be terminated: after specified time, change of circumstances, death, when A says so, when P says so (unless irrevocablecoupled with an interest- (loaning $ to partnership more than just agents right to commission or proceeds of sale) Apparent authority:P leads 3rd party to mistakenly (reasonably) believe A has authority To destroy- P must tell 3rd party that A has no authority Ratification: even if A had no authority, P can still ratify by expressly affirming the K; accepting the benefits of the K; or suing 3 rd party on the K (Must have knowledge, ratify all of K, and capacity to enter into K at time of contracting between 3 rd P and A) Adoption: both promoter and corp remain liable on K, unless Novation is given Relationship Liabilities P&A- A owes P strict Fiduciary duties (loyalty, care, obedience). P must compensate, reimburse & indemnify A P&3rd party: P always liable to 3rd P when A had authority to enter into K 3rd P always liable to P unless there is an undisclosed P and A has special skills (makes 3 rd not know that P exists) A&3rd party- 3rd P is not liable to A, unless As power is coupled with an interest. A is liable to 3rd P if P is undisclosed or partially disclosed-3rd party knows P exists but doesnt know Ps name)

Liability in Tort (RESPONDEAT SUPERIOR - says this in the answer)

Test- if tort is committed by a servant acting w/in scope of his employment, master & servant are jointly & severally liable to the injured party. (Master can be indemnified by servant) - ASK: Does master have right to control (even if not exercised) the servant? If yes J&S liability - Scope of employment is usual takes and deviations which are detours (minor deviations) NOT frolics (major deviations) - Servants intentional torts are outside of scope, unless force is used to further masters biz Direct Liability:Master is liable for his own negligence if failed to train/supervise/or check servants crim. record & job history Scope of liability: (1) usual task = within scope; (2) deviation: either DETOUR (minor deviation) is in the scope; or FROLIC (major deviation) = outside of scope. INTENTIONAL TORTS ALWAYS OUTSIDE SCOPE UNLESS EMPLOYER WANTS VIOLENCE LIKE A BOUNCER AT A NIGHT CLUB Issues tested S01: respondeat superior, scope of employment S06: apparent authority (also called ostensible agency); vicarious liability

LOOK FOR AGENCY QUESTIONS AS A SUB ISSUE IN CORPORATIONS AND PARTNERSHIPS - officers in corporations are corporate agents - partners are each others agents as far as the partnership is concerned