Exam 36: Third-Party Relations of the Principal and the Agent

Tim has the authority to use force to protect the property in his warehouse.He authorizes a security guard he hires to protect the warehouse.The security guard uses force to stop a thief.Is the security guard liable if the thief sues him for causing injury?

When does a scope of employment requirement exist?

When is a principal directly liable for misrepresentations made by an agent?

As a general rule,a principal is not liable for torts committed by independent contractors while performing the principal's business.

Percy is a bus driver but he cannot make his route so he asks Samuel to take his route on for the day as an independent contractor.Samuel drives unsafely and injures a bus passenger.Is Percy liable?.

It is always necessary for an agent to disclose the identity of the principal to any third person with whom he is contracting;otherwise the contract becomes void.

Andy works for Sparkles,a jewelry store.While selling a zircon-studded ring to a customer,Andy falsely states that the zircon is a diamond.The customer,delighted to find a diamond ring at an affordable cost,buys the ring.If the customer files a lawsuit for damages,which of the following will most likely be the court's verdict?

Juan is granted an exclusive easement to drive across Carl's driveway.Juan delegates authority to his agent,Stan,to drive across Carl's driveway.Is Stan liable in trespass for driving across Carl's driveway?

Cyrano hired Roxanne to purchase a yacht.Cyrano did not want sellers to know that he was the buyer because he was very rich and he thought that sellers would demand a higher price if they were aware of this.So he instructed Roxanne to inform the sellers that she was acting for an anonymous buyer.Roxanne did not disclose that she was acting on behalf of a principal,and she entered into a contract to purchase a yacht from Richard.However,Cyrano did not like the yacht that Roxanne selected and refused to pay the purchase price.Richard insisted that Roxanne herself pay the purchase price.If Richard sues Roxanne to enforce the contract against her,what will be the outcome?

Kin is an agent for a disclosed principal,Tracy.Kin contracts with Phil on Tracy's behalf.Kin becomes liable to Phil when:

Estoppel is the concept that a principal may be liable to a third party if that party justifiably believed that the agent had authority to act for the principal and there was a detrimental change in the third party's position.

Pete tells Alice,his sales agent,that under no circumstances does she have authority to make any warranties covering goods she sells for Pete.No third party knows about Pete's limitation on Alice's authority.Alice goes out and provides warranties in a sale to Tom.The warranties that Alice makes are customary in the trade,Tom knows this,and Tom knows nothing about the limitation on Alice's authority.Did Alice have implied authority to bind Pete? Discuss Alice's apparent authority?

A(n)________ case involves harm caused by the principal's negligence regarding the agent.

________ arises when the principal's manifestations cause a third party to form a reasonable belief that the agent is authorized to act in a certain way.

What is a nondelegable duty?

Susan is hired to manage a business.Because she has been hired as a manager,she has the authority to make contracts that are reasonably necessary for conducting the business.This is called:

Anna hired Juan to act as her sales agent in her auto dealership.However,Anna has instructed Juan not to enter into any sales contracts before she has had a chance to review the transaction.One day,Juan entered into a sales contract with William without informing Anna first.Has Juan created a contract with William that is binding on Anna in this situation?

In some cases,both principal and agent may be liable for an agent's torts.

Sometimes,if an agent incurs tort liability the principal is required to ________.

Exculpatory clauses that try to relieve a principal of liability for an agent's misrepresentations usually insulate the principal from tort liability and prevent the third party from rescinding the contract.