Chapter 39: Agency. Agency Relationship. An agency relationship is created by an express or implied agreement whereby one person, the agent , is authorized to make contracts with third persons on behalf of and subject to the control of another person, the principal. Third. Agent.
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Power of Attorney
Conduct of principal as to agent and third person consistent with the existence of an agency relationship
With knowledge of an agent’s act, the principal accepts or retains the benefit of the act, or brings an action to enforce legal rights based on the act, or defends the action, or fails to repudiate the act.
OPERATION OF LAW
Courts create or find an agency when there is none.Creating an Agency
Express Authority: Principal tells agent
Buy new office furniture and sell specified
to perform a certain act.
Incidental Authority: An act reasonably
Buy furniture on credit when funds not
necessary to perform the act expressly
made available to pay for items.
Customary Authority: An act that,
Issue receipts for used furniture sold.
according to the custom of similar
businesses in the community, usually
accompanies the act performed under
Apparent Authority: Principal leads third
Principal was present when third party
purchased furniture from agent and did
party to believe that agent has authority.
not stop the unauthorized transaction.Types of Agent’s Authority