Exam 28: Relationship of Principal and Agent

The Third Restatement specifies that an agency is automatically terminated when the principal goes bankrupt.

The negligence of an agent who is an employee in conducting the business of the principal exposes the principal to tort liability for injury and loss suffered by third persons.

A principal owes to any agent the same duties under tort law that the principal owes to all parties.

If an agent receives a gift from a third person with whom he is dealing on behalf of the principal, he can keep it without notifying the principal.

Authority conferred upon an agent for a specified time does not continue after the specified time.

Which of the following agents would not have authority to contract with third parties on behalf of the principal?

By the operation of law, the occurrence of certain events will automatically terminate an agency relationship.

Mark (age 16) appoints Joe (age 21) as his agent to purchase a digital camcorder from Electronic World. The transaction is:

Which of the following is correct with regard to the capacity of an agent?

Jones, an agent of Rossi, is authorized to sell Rossi's ownership of wheat on the commodities market on Monday. On Monday, however, the market opens with the lowest prices for wheat in two decades. Jones must go ahead and sell Rossi's wheat on Monday.

A principal has no duty to compensate his or her agent if:

An agency contract appointing the agent for a period of more than one year must be in writing.

All independent contractors are agents, but not all agents are independent contractors.

The Restatement's definition of a power given as security includes, but is more extensive than, the rule regarding an agency coupled with an interest.

When the agency terminates, the agent's duty of confidentiality continues.

The duty of obedience owed by an agent to a principal is not breached and will not result in liability to the principal by an agent's refusal to do an illegal or tortious act for the principal.

An agency agreement must always be in writing.

Because the authority given to an agent by a principal is strictly personal, an individual agent's death terminates the agent's actual authority.

An agent will not be authorized to act for a principal unless he receives some consideration for the task.

Since the agency relationship is created by agreement, the agency relationship may be terminated at any time by mutual agreement of the principal and the agent.