Exam 27: Agency Relationships in Business

Nadya and Owen work at Purified Water Company. Nadya is a sales representative who works with Purified's customers,including restaurants,grocery stores,and other businesses,as well as individual consumers. Purified closely supervises all of its sales reps,and dictates their schedules. Owen is an engineer who works in Purified's water treatment plant. -Refer to Fact Pattern 27-1. With respect to third parties,Nadya is Purified's

An agent has a duty to keep and make available to the principal an account of all property and funds received and paid out on the principal's behalf.

Jim agrees to act on Kit's behalf,subject to Kit's control,and Kit trusts Jim to so act. This describes a relationship between

Implied authority is authority declared in clear,direct,definite terms.

Mountain States Distribution Inc. hires Norris to work on Mountain States's shipping dock,accepting deliveries,dispatching trucks,and dealing with customers and other companies' drivers. With respect to Mountain States,Norris is most likely

If a principal ratifies a contract without knowing all of the facts,the principal can rescind the contract.

A person must have contractual capacity to be an agent.

Emery is a corporate officer of Frakking Mining Corporation. Emery serves in a representative capacity for Frakking's owners. With respect to binding Frakking Mining to contracts,Emery is

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

An agency coupled with interest is a relationship created for the benefit of the principal.

The agent has the right to be compensated,and to be reimbursed and indemnified.

Reynaldo is a delivery driver for Southeast Asian Noodle Company. Reynaldo does exactly what the company tells him. Reynaldo is

Mirena serves in a representative capacity for Netanya. Orla is injured through Mirena's negligence. Netanyamay be liable to Orla if Mirena's conduct occurred

An agent's duties to the principal are implied from the agency relationship only if the identity of the principal is disclosed to a third party.

Roberta introduces Steve to her friends as "my associate." Steve purports to act as Roberta's agent in several business transactions with those friends. If Roberta is liable for Steve's actions,it will be because their relationship is

Kelvin is an agent for Lookout Mountain Accountants,Inc. On Lookout's behalf and at its request,Kelvin pays Nerdlinger for custom software designed for the management of Lookout's serv-ices. Kelvin's right to obtain the amount of those payments from Lookout arises under the principal's duty of

A principal has a duty to cooperate with the agent and to assist the agent in performing his or he duties.

John contracts with Kelly to buy a certain number of cattle for Kelly's Circle K ranch. John makes a deal with Lawson,the owner of a local herd,and makes a down payment. 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 of

Agency relationships only exist between employers and employees.

Employment laws apply only to the employer-employee relationship.