Exam 32: Agency Formation and Duties

Gary drives a truck as an employee for Hauling Inc. Gary would most likely be considered acting outside the scope of her employment if he

A truck driver who drives a company truck on a regular basis is most likely an employee.

Isabel is an agent for Julian. He gives her clear instructions to enter into contracts on his behalf only on Mondays. She enters into a contract on his behalf on Friday. Isabel has breached

Chu, an agent for Delivery Corporation, rents a truck from Equipment Inc. without revealing that he is acting on Delivery's behalf. When Delivery fails to pay for the use of the vehicle, the lessor collects the unpaid amount from Chu by judicial process. Entitled to be indemnified is

An undisclosed principal is one whose identity is totally unknown by an agent and a third party at the time a contract is made.

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

When a principal makes it possible for an agent to defraud a third party, the principal may also be liable for the fraud.

If a principal's instructions are not clearly stated, an agent can fulfill the duty of obedience by acting in good faith and in a reasonable manner.

Nora works at Oil & Gas Inc. She is a sales representative who works with Oil & Gas customers. The company closely supervises its sales reps, and dictates their schedules. With respect to third parties, Nora is

Corinne discloses that she is acting as an agent on behalf of Development LLC when she enters into a contract with Enterprise Funds Inc. Liability for nonperformance of the contract may be imposed on

Bristol is an officer of Commerce Company. To conduct ordinary business transactions on the firm's behalf, Bristol

Agency relationships come about by voluntary consent and agreement of the parties-consideration is required, and the agreement must be in writing.

Without express or implied authority, Xi contracts on behalf of Yan to purchase a certain building from Zhu. Yan and Zhu are not bound in contract unless Yan

Power Company employs Qin to negotiate the purchase of rights of way for a future power transmission project. Qin secretly buys some of the property along the planned route and sells the rights to Power at a profit. Qin has breached

An agent has the discretion whether to notify his or her principal of matters that come to the agent's attention concerning the subject of the agency.

An executive corporate officer can normally conduct ordinary business transactions without first obtaining the corporation's written authority.

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

Authority to manage a business implies authority to do what is reasonably required to operate the business.

Ira serves in a representative capacity for Jeff. Key is injured through Ira's negligence. Jeff may be liable to Key if Ira's conduct occurred

Life Insurance Company hires Minh to sell insurance policies for the company. Minh agrees to act on the firm's behalf in the endeavor, and the company trusts Minh to so act. Minh is