Exam 29: Relationship of Principal and Agent

The principal has the duty to provide the employee with reasonably safe conditions of employment and to warn the employee of any unreasonable risks involved in the employment.

Arthur advances money to John so that John can purchase inventory for his business.In return and for security on the loan, John makes Arthur his agent.If John:

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

The operation of agency involves only two persons: a principal and an agent.

A gratuitous agency is not a true agency because it is not formed by contract.

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

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

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

Matt hires Joe's real estate agency to sell his property, telling Joe he has lost too much money playing the stock market to afford to keep it up.Then Matt wins the three million-dollar lottery! Joe reads this in the newspaper and that afternoon makes a contract with Sharon to sell the property.Is the contract valid?

A plumber hired to redo the plumbing in a building is an independent contractor and an agent of the owner of the building.

Discuss the nature of agency, including the scope of agency purposes.

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.

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.

Agency is governed primarily by:

In some states, the authority of an agent to sell land must be in writing and signed by the principal.

If an agency is gratuitous, the principal ordinarily may revoke it without liability to the agent.

Which of the following is not a breach of an agent's duty of obedience?

The appointment of an agent by a minor or an incompetent not under guardianship and any resulting contracts are voidable.

The concept of conflict of interest as it relates to the law of agency includes which of the following?

A gratuitous agent has a duty of loyalty but is not liable for any harm caused by his careless performance.