Exam 20: Relationship With Third Parties

A principal who authorizes his agent to commit a tortious act with respect to the property or person of another is not liable for the injury or loss sustained by that person.

A subagent owes a fiduciary duty to only the principal.

Regarding the termination of an agency, the Third Restatement:

Apparent authority may arise in all but which of the following ways?

Unless otherwise agreed, an agent making a contract for an unidentified principal is not a party to the contract.

Ordinarily, an agent may delegate his duties to an equally qualified subagent.

The Second Restatement provides that the death of a principal terminates all authority of an agent, including apparent authority, even though no notice is given to third parties.

Pat bought a cotton sweater at Ivey's Fashion Store.Sue, the salesperson, told her the sweater was guaranteed not to shrink if washed in cold water by hand.Pat washes the sweater as directed and it shrinks.Which of the following is correct?

Roy is the promoter of a new corporation that has not yet been organized.On behalf of the as-yet unincorporated business, he enters into a three-year lease agreement for office space and personally signs the lease in his own name.The corporation is liable on the contract, because Roy is its agent.

An employer can be liable for an agent's negligence, but he will never be liable for his intentional torts.

Julie writes a letter to Mitchell authorizing him to sell her boat and sends a copy of the letter to Jared, a prospective buyer.The next day, Julie writes Mitchell a letter revoking his authority to sell the boat, but she does not send a copy of the second letter to Jared.Although Mitchell has no actual authority to sell the boat now, he continues to have apparent authority with respect to Jared.

An employer may have criminal liability for the acts of his employee.

Richard writes a letter to Sarah authorizing her to sell his car and sends a copy of the letter to Timothy, a prospective purchaser.If the next day Richard sends a letter to Sarah revoking her authority, but he fails to notify Timothy, Sarah:

The purpose of an agency relationship is to:

When there was a contract with a previously undisclosed principal, the Third Restatement:

Jack was fired by Larry but decided to try to win back his job as agent by getting a big new contract.He approached Sharon, a new client, and made a pitch to sell Larry's product.Sharon agreed to buy 100.Jack tells Larry.What are the legal consequences?

Apparent authority arises out of words or conduct of a disclosed or unidentified principal manifested to third persons.

Upon the termination of an agency, the agent's actual authority ceases.However, his apparent authority may continue until actual notice of the termination is given to third parties.

An agent is personally liable for the torts he commits while in the scope of his employment.

Bryant, doing business as Fair Realty, employs Chris and Deborah as salespersons.Tammy contracts with Bryant to sell her house because she is aware of the good reputation of Fair Realty's salespersons.In this situation: