Exam 28: Agency Relationships in Business

Jock hires Kym to act as his agent to purchase Lifetime Gym & Fitness,Inc.Jock tells Kym to reveal that she is buying the firm on behalf of a third party and to tell Lifetime's seller who that third party is.Jock is

A fiduciary relationship involves trust and confidence.

Without authorization,Rolf contracts on behalf of Sari to have Tige paint the interior and exterior of Sari's house.Sari ratifies the contract.Later,Sari tries to rescind the part of the contract relating to the exterior.This attempt will be

A principal is not liable for an agent's fraud unless the agent has the apparent authority to commit torts.

Sonia manages a Tasty Pastry store for United Food Company.To manage the business,Sonia's authority can be implied by

If a principal does not ratify an authorized contract,the principal is not bound.

Oscar is Precise Service Company's chief executive officer.On Precise's behalf,Oscar solicits business,hires and fires workers,and handles the finances.Precise pays Oscar varying amounts,depending on his "needs." Oscar is most likely

Delite Candy Company hires Elton to sell Delite's products in a certain area.Delite agrees to pay Elton a salary,plus commission,for a trial period.They also agree that Elton can sell using any methods and during any hours that seem appropriate.The key factor in whether Elton is Delite's employee is

An agent is authorized to act on behalf of a principal in doing business with third parties.

A principal is not liable to a third party for any contract made by the agent acting outside the scope of his or her authority.

Iggy hires Joy to act as his agent to purchase Kup-a-Koffee Kompany.Iggy tells Joy to reveal only that she is buying the firm on behalf of a third party,without telling Kup-a-Koffee's seller who that third party is.Iggy is

Brenda is a purchasing agent for Commodities Exchange Corporation.Dennis,a Commodities corporate officer,gives Brenda written authority to buy for the firm as many computers and peripheral devices as necessary.The next day,Dennis calls Brenda and tells her to buy only fifty notebook computers and nothing else.Brenda shows the written authority to E-Products,Inc.,and enters into a contract with E-Products to buy sixty notebook computers and a selection of printers,scanners,and extra storage media.E-Products ships the order to Commodities.Is Commodities liable to E-Products under the contract Is Brenda liable In each case,if so,why If not,why not

In considering the scope of an agent's implied authority,the test is whether the agent reasonably believed that he or she had the authority.

An agency can terminate once its purpose is achieved.

A principal is responsible for all intentional torts committed by an agent.

Clu serves in a representative capacity for Digger.Elmo is injured through Clu's negligence.Digger may be liable to Elmo if Clu's conduct occurred

Geoff serves in a representative capacity for Huck.To accomplish the objectives of this relationship,Geoff's authority can be implied

An agent can take advantage of an agency relationship to make a "secret" profit.

Home Development Company employs llya to buy property for a future residential development.Ilya secretly buys some of the property and sells it to Home Development at a profit.Ilya has breached

Jody is an agent for Insta Cross Country Trucking Inc.In the course of Jody's performance for the firm,Jody pays Heck for certain vehicle maintenance and repair services.Jody's right to obtain the amount of those payments from Insta arises under the principal's duty of