Exam 25: Agency Relationships

If an agent has represented himself or herself as possessing special skills, the agent is expected to use them.

The greater the employer's control over the work, the more likely it is that the worker is an employee.

An independent contractor is one whose performance is controlled, or subject to control, by the employer.

Normally, employees who deal with third parties are deemed to be agents.

Garry drives a truck as an employee for Heavy Hauling, Inc. Garry would most likely be considered acting outside the scope of his employment if he

The principal is bound by the agent's unauthorized act, unless the principal negates it.

Independent contractors are not considered employees.

Len, an agent for Mind Games LLC, executes an unauthorized contract with NOW Marketing, Inc. The deal is highly advantageous to Mind, and the company ratifies the contract. The contract is

All agency agreements must be in writing.

A n agency agreement cannot be implied from conduct.

W ithout authorization, Lars contracts on behalf of Mina to have Nemo paint the interior and exterior of Mina's house. If Mina decides to ratify the contract, she must affirm

Watercraft Inc. employs Vern as a sales agent for a trial period. At the end of the period, Watercraft and Vern disagree on the amount of the commissions Vern is due for sales that he made. Watercraft, Inc. may demand

Any person can be a principal , regardless of whether he or she has the capacity to contract.

Orin hires Pat, a real estate broker, to sell her oceanfront house. The house is destroyed in a hurricane before being sold. Pat is Orin's agent

Chuck hires Danielle, a real estate broker, to act as his agent to sell his land for $150,000. Oil is discovered beneath the land, causing its market value to in-crease considerably. The agency agreement is likely

Roman is the chief executive officer of Salty Snax Corporation.  Roman's responsibilities include decisions on product development, marketing, and other significant business directions. Roman is subject to the approval and oversight of Salty Snax's board of directors.  Teri is a Salty Snax manager whose duties include the firm's day-to-day hiring, firing, purchasing, and selling.  Umberto is a Salty Snax salesperson, whose daily activities are controlled by Teri.  Velma writes sales manuals and instructions for Salty Snax's products ac-cording to Roman's instructions and subject to Salty Snax's control, but has no dealings with the company's customers or suppliers.  Warren writes advertising and promotional materials on a contract-per-project basis and is not otherwise subject to Salty Snax's control.  Who is a principal?  Who is an agent?  Who is an employee?  Who is an independent contractor? Explain.

Miklos employs Nathalie to handle a list of financial transactions on Miklos's behalf . This power will terminate on

Jewelry & Coin Company hires Kelly Ann to buy gems and precious metals from various sources on its behalf. In this relationship, Jewelry & Coin is

Kevin is an agent for Lookout Accountants, Inc. On Lookout's behalf and at its request, Kevin pays Nathan for software designed for the management of Lookout's services. Kevin's right to obtain the amount of the payment from Lookout arises under the duty of

Jill agrees to act on Kit's behalf, subject to Kit's control, and Kit trusts Jill to so act. This describes a relationship between