Deck 20: Agency

Question 1

An independent contractor may not act in the capacity of an agent.

Answer 1

False

Question 2

A principal whose identity is not known by a third party with whom an agent contracts on the principal's behalf is an apparent principal.

Answer 2

False

Question 3

Under the doctrine of respondeat superior,a principal is liable for any harm to an agent.

Answer 3

False

Question 4

All agency relationships are based on contract.

Question 5

An agent's implied authority can be inferred by the position the agent occupies.

Question 6

An agent has a duty to follow all clearly stated instructions of the principal,lawful or not.

Question 7

Agency relationships do not exist between employers and employees.

Question 8

A person must have contractual capacity to be a principal.

Question 9

When an agency relationship is terminated,the principal has a duty to personally notify third parties who knew of its existence.

Question 10

A principal can ratify an agent's unauthorized act in its entirety or merely in part.

Question 11

In general,for every duty of the principal,the agent has a corresponding right.

Question 12

A principal is exposed to tort liability whenever a third person sustains a loss due to an agent's misrepresentation.

Question 13

An agent is required to notify the principal of all matters concerning the subject matter of the agency.

Question 14

A principal owes an agent a duty of obedience.

Question 15

Employment laws apply only to the employer-employee relationship.

Question 16

A party to an agency may have the right to terminate the relationship but not the power.

Question 17

An agent has the right to perform agency duties without interference by the principal.

Question 18

Apparent authority usually comes into existence through a principal's pattern of conduct over time.

Question 19

If an agent contracts outside the scope of his or her authority,the principal cannot become liable.

Question 20

An agent's actions must be strictly for the benefit of the principal.

Question 21

Chelsea,an agent for Bountiful Seafood,Inc. ,has often done business with Alvin's Dockside Diner on Bountiful's behalf.When Chelsea and Bountiful terminate their agency,to avoid liability for later deals,Alvin's must be notified by

A)Chelsea and Bountiful.
B)Chelsea only.
C)Bountiful only.
D)no one.

Question 22

Rita is appointed as an agent for Superior Sales,Inc.The agency agreement is silent as to the level of sales that Rita is expected to achieve.She must

A)achieve nothing because the agreement says nothing on the issue.
B)attain the level that Rita achieved with her previous employer.
C)maintain the level Superior attained before Rita became an agent.
D)use reasonable diligence and skill in selling.

Question 23

Dizzy is not Edwina's agent but enters into a contract with Frida on Edwina's behalf.Edwina later contacts Frida to approve the contract.This is

A)an agency by agreement.
B)an agency by estoppel.
C)an agency by ratification.
D)not the creation of an agency relationship.

Question 24

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

A)by contradiction.
B)by custom.
C)by lack of reason.
D)under no circumstances.

Question 25

Jody is an agent for Kwik Credit Company (KCC).In the course of Jody's performance for KCC,Jody pays Leo for certain auto maintenance and repair services.Jody's right to obtain the amount of those payments from KCC arises under the principal's duty of

A)avoidance.
B)cooperation.
C)indemnification.
D)reimbursement.

Question 26

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 the seller who that third party is.Jock is

A)a disclosed principal.
B)an apparent principal.
C)an undisclosed principal.
D)an identified principal.

Question 27

Mona is an agent for Nationwide Restaurant Corporation (NRC).In acting as an agent,Mona follows all of NRC's clearly stated instructions.This responsibility arises under

A)no agent's duty.
B)the agent's duty of loyalty.
C)the agent's duty of notification.
D)the agent's duty of obedience.

Question 28

Fact Pattern
Eppie hires Franz to do some remodeling work in her office.
Refer to Fact Pattern 20-1B.While working,Franz drops a tool on Gibby,Eppie's customer,causing an injury.Eppie is

A)liable to Gibby because he was injured on Eppie's property.
B)liable to Gibby unless Franz's act is intentional.
C)not liable because Franz is an independent contractor.
D)not liable to Gibby because Franz is Eppie's employee.

Question 29

Bud approves on behalf of Cody-but without authorization-a contract with Devon to build a new silo.Cody does not ratify the contract.Later,Devon tries to enforce the deal.This attempt will be

A)partly successful.
B)partly unsuccessful.
C)totally successful.
D)totally unsuccessful.

Question 30

Ester is a lighting technician who hires out on a per-project basis to film and television production companies,as well as theatres and other venues that stage dramatic and musical performances.In this capacity,Ester is

A)an agent.
B)an employee.
C)an independent contractor.
D)a principal.

Question 31

Elle is an agent for Fine Cosmetics,Inc.Elle owes Fine Cosmetics the duty of

A)avoidance.
B)compensation.
C)indemnification.
D)performance.

Question 32

Prospective Enterprises (PE)employs Quinn to buy property for a possible commercial development.Quinn secretly buys some of the property and sells it to PE at a profit.Quinn has breached

A)no duty.
B)the duty of accounting.
C)the duty of loyalty.
D)the duty of notification.

Question 33

National Computer Corporation (NCC)employs Cynthia as an agent.NCC gives her an exclusive territory in which to sell NCC products.NCC cannot compete with her in that territory under the duty of

A)compensation.
B)cooperation.
C)indemnification.
D)reimbursement.

Question 34

Carol agrees with Dede and other performers to sign contracts with promoters and others on the performers' behalf.Carol is

A)an agent.
B)an employee.
C)an employer.
D)a principal.

Question 35

Picabo drives a truck as an employee for Quik Delivery,Inc.Picabo would most likely be considered acting outside the scope of her employment if she

A)crashed into a car at the airport while off duty.
B)hit a pedestrian in a parking lot during a "working" lunch.
C)ran over an attendant at a gas station while refueling the truck.
D)smashed into a store-front while intoxicated on-duty.

Question 36

Based on Bluto's conduct,Cass reasonably believes that Dee has the authority to act on Bluto's behalf even though Dee does not have the actual authority to do so.Bluto has

A)apparent authority.
B)equal authority.
C)express authority.
D)implied authority.

Question 37

Espresso Roast Company hires Forrest to work on Espresso's shipping dock,checking outgoing loads and dispatching Espresso's drivers.With respect to Forrest,Espresso is most likely

A)an agent.
B)an independent contractor.
C)a principal.
D)a work for hire.

Question 38

Neighborly Insurance Company and Ollie put their agency agreement into a written document that describes the rights and duties of both parties.Ollie,as the agent,has

A)apparent authority.
B)equal authority.
C)express authority.
D)implied authority.

Question 39

Maia hires Nero,a real estate broker,to sell her warehouse.The warehouse burns down before being sold.Nero is

A)Maia's agent until Maia's insurer pays Nero's commission.
B)Maia's agent until the burnt warehouse is sold.
C)Maia's agent until the warehouse is rebuilt and sold.
D)no longer Maia's agent.

Question 40

Fact Pattern
Eppie hires Franz to do some remodeling work in her office.

-Refer to Fact Pattern 20-1B.The relationship between Eppie and Franz is

A)client and independent contractor.
B)employer and employee.
C)master and servant.
D)principal and agent.

Question 41

Harbor Bay Development hires Guthrie to act as its agent to buy a 100-acre waterfront tract of land from Frankie for $1,000 per acre.Harbor Bay does not want Frankie to know that it is the principal or that Guthrie is its agent.Harbor Bay wants the land for a new marina,and believes that Frankie may not sell the land for that purpose or may demand a premium price.Guthrie makes the purchase,signing only his name on the contract as the buyer and not disclosing to Frankie the agency relationship.Harbor Bay gives Guthrie the amount to pay for the land,but Guthrie absconds with the funds.Frankie soon learns of Harbor Bay's identity.Can Frankie enforce the contract against Harbor Bay ?against Guthrie?

Question 42

Pete's Pizza employs Quincy as a delivery driver.Pete's guarantees that an order will be delivered within thirty minutes or there is no charge,and insists that its drivers meet the limit.One night,while making a delivery,Quincy is caught in a traffic jam.To deliver the pizza within the thirty-minute time limit,Quincy drives onto a sidewalk and hits Ruth,a pedestrian.Is Pete's liable to Ruth for her injuries ?Is Quincy liable to Ruth ?Why or why not?