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Exam 17: Agency Law

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Question 21

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A principal is bound by contracts that an agent enters into with authority.Discuss the various types of contractual authority an agent may have.

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Authority is the legal ability of an age...

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Question 22

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When a principal is partially disclosed:

A) the agent and principal will be jointly and severally liable on the contract.
B) the agent and principal will be only jointly liable on the contract.
C) only the principal can be liable.
D) only the agent is liable.

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Question 23

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Chance is a traveling marketing representative for a publishing company.He is an independent contractor.One afternoon while driving to a meeting,he negligently runs a stop sign and causes an accident.Judy is injured.Judy can:

I have an express rule that if any of my sales staff drinks at lunch they are fired on the spot.Jeff one of my salesmen,after a liquid lunch has a wreck and injures Betty. Which of the following is true.

Tom,the production manager at Esday,was told by his supervisor to hire Elton,a 15- year-old,to operate an industrial machine.Hiring the 15-year-old violates the child labor laws.Tom:

An agency relationship can be created:

I hire a secretary to run my office. Which of the following does she not have implied authority to do.

As a general rule,an agent is liable on contracts entered into on behalf of a fully disclosed principal.

Which of the following persons is an agent?

Mrs.O'Leary hired Jenna to sell her house in Michigan.She executed a power of attorney in favor of Jenna authorizing her to do "anything and everything associated with the sale of real estate,acting as a prudent person." On May 30,Jenna finalized a deal with Brandon for the purchase of the house.Brandon and Jenna signed the real estate contract that day.Jenna learned the next day that Mrs.O'Leary had died May 29.

Nikki was an tax accountant with HBR Accounting.Nikki decided to do some tax consulting in the evenings and on weekends.HBR is unaware of Nikki's consulting work.Which statement is correct?

You cannot be held liable for the actions of your agents if the agents are violating your instructions.

An agent may not engage in inappropriate behavior that reflects badly on the principal.This rule applies to conduct:

John hired Tim to sell his house.Which statement is correct?

Barnett was orally hired by Paula to locate desirable real estate that she could use for rental property.She stated she wanted to find a four-plex that could be purchased for under $200,000 that could be rented for at least $1,000 per month per unit (which equates to $4,000 rental per month for the property).Barnett located a four-plex that could be purchased for $160,000 and was renting for $1,200 per unit.It was such a good deal that he purchased it for himself.About two months later he found a second property that was listed for $199,000 and rented for $1,000 per unit.Paula purchased the property.Afterwards,she learned that Barnett had bought the $160,000 four-plex for himself without telling her about it.Paula believes that Barnett has acted improperly.Barnett claims that he did what she asked -- he found a property for under $200,000 that rented for $1,000 per unit.He also claims that since their agreement was oral,he has a legal defense if she pursues the matter in court.Does Paula have any legal recourse against Barnett? Explain.

Jim agreed to show Donna's car to a potential buyer.Donna was not able to be home since she had to attend a meeting.After showing the car,Jim left the keys in it and the car was stolen.Which statement is correct?

Larry decided to relocate to Germany.Larry hired Happy Homes,Inc.to find a buyer and contract for the sale of his house in the U.S.The agency relationship between Larry and Happy Homes must be evidenced with a written agreement.

If apparent authority is present,the principal is liable for even the unauthorized acts of the agent.

HBR Accounting hired Denise,to negotiate a real estate deal but wants to keep their name out of the deal until after the closing.Which statement is correct?

If Denise is hired to work as a cashier,she has the implied authority to do acts reasonably necessary to carry out her job.