Exam 25: Agency Relationships

By using agents, a principal can conduct multiple business operations simultaneously in various locations.

Denny, a certified public accountant and an investor, and Ethel, an insurance salesperson and a realtor, may create an agency relationship for

Bern, a salesperson at a Cabinets store, tells Dan, a customer, "Buy your cabinets here, and I'll install them for less than the store would charge." Dan buys the cabinets, which Bern installs for half the store's price. Bern keeps the money. With respect to the store, Bern has breached

An agency relationship exists between spouses even where there is no formal agreement.

Rosario is a chef and caterer who works for different event planners, party hosts, and some private companies and families where he goes to their location to prepare meals. In this capacity, Rosario likely is

The doctrine of respondeat superior imposes vicarious liability on a principal without regard to the personal fault of the agent.

Larry is an agent for Mary. She gives him clear instructions to enter into contracts on her behalf only on Mondays, Wednesdays, or Fridays. He enters into a contract on her behalf on Tuesday. Larry has breached

Fact Pattern 25-2 Berry indicates that she is acting as an agent on behalf of an unidentified client-Cuisine Catering, LLC-when she enters into a contract with Dean. Refer to Fact Pattern 25-2. Cuisine Catering is

Ingmar asks Jess to contract with Kay's Lawn Service on Ingmar ' s behalf to maintain Ingmar's lawn. Jess orally agrees to do so. This is an agency by

I f a principal makes statements that would cause a reasonable person to believe that an agency relationship exists, then the supposed agent receives actual authority to act as the agent.

Giving an agent a power of attorney confers express authority.

Kelly hires John to buy a certain number of cattle for Kelly's ranch. John makes a deal with Lawson, the owner of a local herd, and makes a down payment on Kelly ' s behalf. Kelly fails to pay the rest of the price. Lawson sues John for breach of contract. John's right to hold Kelly liable for any damages that he has to pay is the right to