Exam 17: Agency Law

If the agent is disloyal to the principal:

An agency will be terminated in all but which one of the following situations?

Betsy's elderly father gave her written authority her to sell the family house.Her father lived in Arizona and she lived in Minnesota.After about two months she found a buyer for the house and signed an acceptance of the offer on March 21.Later that same day she learned her father had died the day before (March 20).Other members of the family did not want the family house sold and claimed that the acceptance Betsy signed was void.The buyer of the house claims Betsy had the legal authority to sell the house and that the contract is binding.Who is right?

An agent cannot disclose nor use for their own benefit any information they learn during the agency

Mohammad was an employee in the new product development department of Estay Inc.Mohammad was directly involved in the development of a new product that Estay intended to launch in 6 months.Estay took great care to keep information concerning the new product a secret.Ceries,Inc.,a competitor of Estay,persuaded Mohammad to leave Estay to direct Ceries' marketing department.Which statement is correct?

Circus Pizza contracted with Art to run its birthday parties.Art's responsibilities included supervising the children and organizing the games.Circus did not investigate Art's background,which included a history of assaulting children.Art assaulted a 7-year-old girl in the restaurant's kitchen during a birthday party.Circus Pizza:

Alex worked for years for MegaCorp.During his employment with MegaCorp,he learned a great deal of confidential information and knew that if this information got into the hands of competitors or the general public,MegaCorp could suffer great business losses.Alex claims that he was wrongfully fired by MegaCorp and accordingly he believes he has no obligation to MegaCorp to keep any information he acquired with them as confidential.MegaCorp claims that Alex is under a continuing duty to keep confidential information secret,even though he is no longer with the company.Who is right? Why?

Ron is the business agent for Kansas Sunshine,a rock band.He is also the agent for another popular Midwestern rock group,City Sand.Ron negotiates a deal with a Kansas City promoter to have City Sand play after a professional football game.The promoter was willing to pay $250,000 for both groups to play after the game; however,Ron talked her into booking just City Sand for $175,000.Given his contract with City Sand,Ron made more money under this arrangement.Has Ron violated his fiduciary duty to Kansas Sunshine?

The death of an agent automatically terminates an agency relationship.

The doctrine of estoppel would most often apply in situations of:

Janet was employed as a sales representative for Esday,Inc.An appreciative customer gave her a diamond bracelet for all her hard work on a complicated contract.Can Janet keep the bracelet?

Factors influencing whether a servant is acting within the scope of employment include all but which of the following?

Andrew has been hired to do some work for Rossi Enterprises.What factors would a court consider in determining if Andrew is an employee or an independent contractor? Why does the designation matter?

An agent is always liable for his or her own torts committed within the scope of the agency relationship.

An agent must obey all instructions of the principal.

Cameron,editor of the local newspaper,assigned to Jim the writing of a story about pollution of a nearby stream.Although Jim used reasonable care in gathering and checking his information,unknown to Jim,the story contained a defamatory statement about Maureen.Maureen reads the story and sues Jim for libel.Cameron,who read and published the story:

Rob agrees to act as an agent for Diane in selling her car.Diane has a duty of loyalty to Rob.

Pamela hired Lena to sell her business.Lena:

A principal must indemnify an agent for any expenses incurred in carrying out agency responsibilities,but the principal will not be responsible for indemnifying an agent for any expenses not expressly authorized.

Generally,either party to an agency relationship has the power to terminate it at any time.