Agency and Partnership
Home > Flashcards > Print Preview
The flashcards below were created by user
on FreezingBlue Flashcards
. What would you like to do?
Principal - Agent Relationship
A principal-agent relationship requires that there be assent, benefit, and control. Assent is an information agreement between the parincipal, who has capacity, and the agent. The agent's conduct must be for the benefit of the principa. The principal must have the right to control the agent by having the power to supervise the manner of the agent's performance.
Independent Contractor vs. Agent
An agent is subject to the supervision of the principal in the details of the employee's work, whereas an independent contractor follows his own discretion. However, the independent contractor/agent distinction is only important in tort cases and not issues of contractual liability.
Actual Express Authority
Actual express authority is when the principal uses words to express authority to the agent. Actual express authority can be oral and private, but it is narrowly contructed. However, if the contract to be entered into by the agent must be in writing, then the express authority to enter the contract must also be in writing.
Actual Implied Authority
Actual implied authority is when the principal gives the agent authority through conduct or cicumstance. Actual implied authority can occur through necessity, custom, or prior dealings between the principal and the agent.
Necessity is when the agent has the authority to do all tasks which are necessary to accomplish an expressly authorized task. Custom is the implied authority to do all tasks which as customarily performed by an person of the agent's title or position. Prior dealings allows for implied authority when the agent believes to have been authorized to do from prior acquiescence by the principal.
Apparent authoirty is found upon the satisifaciton of a two part test: 1) the prinicpal "cloaked" the agent with the appearance of authority, and 2) a thrid party reasonably relies on the appearance of authority.
Authority can be granted after the contract has been eentered if three elements are satisfied. 1) the principal has knoledge of all material facts regarding the contract. 2) the principal accepts its benefits. 3) Ratification cannot alter the terms of the contract.
Duty to Compensate
The principal has a duty to compensate her agent reasonably for her services, unless the agent has agreed to act gratuitously.
Duty to Reimburse
The principal owes the agent a duty to indemnify her fo all expeneses or losses reasonably incurred i discharging any authorized duties, including any legal liability incurred by the agent in acting for her principal, unless the loss was due solely to the agent's fault.
A limited partnership is a partnership composed of one or more general partners and one or more limited partners. The general partners are personally liable for partnership obligations, while the limited partners generally do not have any liability beyond the liability to make agreed upon contributions. In order to form a limited partnership, a certificate of limited partnership must be filed with the Secretary of State.
Limited Liability Partnership
To become a limited liability partnership, a partnership must file a statement of qualification with the Secretary of State. A partnership becomes an LLP at the time of filing of the statement or on the date specified in the statement. The advantage of operating as an LLP is that the partners are not personally responsible for the LLP's obligations.
A general partnership is an association of two or more persons to carry on as co-owners in a business for profit. There is no requirement that the parties subjectively intend to form a partnership, only that they intend to run a business as co-owners. Moreover, there are no formal regquirements to the formation of a general partnership. Courts generally look to the intent of the parties to determine whether a general partnership existed.
Termination of Authority
A principal can unilaterally terminate his agent's actual authority by communicating directly to the agent that the agency is over. However, mere communication to the agent is not sufficient to terminate an agent's apparent authority. To terminate an agent's apparent authority, the principal must personally notify third parties he knew had dealings with the agent and must publish notice for all others. In cases where the principal has given his agent a writing manifesting the agent's authority, the principal must collect the writing from the agent.
What would you like to do?
Home > Flashcards > Print Preview