Question 1

When a person purports to act as an agent for a principal,an implied warranty arises that such person has authority to do so.

Accepted Answer

A) True 
 B)False  True

Question 2

If an agent commits a crime,the agent's liability will depend on the agency relationship.

Accepted Answer

A) True 
 B)False  False

Question 3

John Smyth is an agent for L.T.Adams.To avoid becoming a party to any contract that Smyth signs for Adams,Smyth should sign in which of the following ways?

Accepted Answer

A)  John Smyth,agent 
B)  John Smyth,for the principal 
C)  John Smith,as agent for the principal 
D)  L.T.Adams,per John Smyth 
A)  John Smyth,agent 
B)  John Smyth,for the principal 
C)  John Smith,as agent for the principal 
D)  L.T.Adams,per John Smyth D

Question 4

If an agent makes a properly authorized contract with a third person on behalf of a disclosed principal,the agent has no personal liability on the contract.

Accepted Answer

A) True 
 B)False

Question 5

When a third person makes payment to an authorized agent,such payment is deemed made to the principal at the time the agent remits the payment to the principal.

Accepted Answer

A) True 
 B)False

Question 6

An agent's liability as a party to a contract with a third person is not affected by the degree of disclosure.

Accepted Answer

A) True 
 B)False

Question 7

Modern law holds that an employer is liable for an intentional tort committed by an employee for the purpose of furthering the employer's business.

Accepted Answer

A) True 
 B)False

Question 8

The liability of a buyer for the purchase price of goods is terminated by the fact that the buyer gave the buyer's agent the purchase price to remit to the seller.

Accepted Answer

A) True 
 B)False

Question 9

When a business owner uses an independent contractor to perform nonhazardous work,the owner ordinarily is:

Accepted Answer

A)  not liable for harm to third persons or their property. 
B)  not bound to contracts made by the independent contractor. 
C)  not liable for the negligence of employees of the independent contractor. 
D)  all of the above. 
A)  not liable for harm to third persons or their property. 
B)  not bound to contracts made by the independent contractor. 
C)  not liable for the negligence of employees of the independent contractor. 
D)  all of the above.

Question 10

Modern decisions hold the principal liable for which actions of the agent?

Accepted Answer

A)  Fraudulent acts 
B)  Misrepresentations 
C)  Both a.and b. 
D)  Neither a.nor b. 
A)  Fraudulent acts 
B)  Misrepresentations 
C)  Both a.and b. 
D)  Neither a.nor b.

Question 11

In a simple contract made by an authorized agent on behalf of a disclosed principal,the third person may sue either the agent or the principal in the event of a breach.

Accepted Answer

A) True 
 B)False

Question 12

If a contract is ambiguous regarding whether the agent has signed in a representative or an individual capacity:

Accepted Answer

A)  there is a presumption that the agent signed in a representative capacity. 
B)  there is a presumption that the agent signed in an individual capacity. 
C)  the agent and the principal will both be liable on the contract. 
D)  parol evidence is admissible to establish the character in which the agent was acting. 
A)  there is a presumption that the agent signed in a representative capacity. 
B)  there is a presumption that the agent signed in an individual capacity. 
C)  the agent and the principal will both be liable on the contract. 
D)  parol evidence is admissible to establish the character in which the agent was acting.

Question 13

A(n)______________ principal is liable for a simple contract made by an authorized agent.

Accepted Answer

A)  partially disclosed 
B)  undisclosed 
C)  both a.and b. 
D)  neither a.nor b. 
A)  partially disclosed 
B)  undisclosed 
C)  both a.and b. 
D)  neither a.nor b.

Question 14

Different rules of law govern the vicarious liability of principals and employers.

Accepted Answer

A) True 
 B)False

Question 15

Apparent authority has the same effect as:

Accepted Answer

A)  undisclosed authority. 
B)  actual authority. 
C)  partially disclosed authority. 
D)  none of the above. 
A)  undisclosed authority. 
B)  actual authority. 
C)  partially disclosed authority. 
D)  none of the above.

Question 16

In which of the following scenarios is the agent exposed to the greatest risk of liability?

Accepted Answer

A)  disclosed principal and authorized contract 
B)  undisclosed principal and authorized contract 
C)  partially disclosed principal and authorized contract 
D)  authorized receipt of money from third person remitted to disclosed principal 
A)  disclosed principal and authorized contract 
B)  undisclosed principal and authorized contract 
C)  partially disclosed principal and authorized contract 
D)  authorized receipt of money from third person remitted to disclosed principal

Question 17

An agent making a proper contract with a third person on behalf of a disclosed principal:

Accepted Answer

A)  has no personal liability on the contract. 
B)  is liable only to the principal on the contract. 
C)  is liable only to the third party on the contract. 
D)  is personally liable to both the principal and the third person on the contract. 
A)  has no personal liability on the contract. 
B)  is liable only to the principal on the contract. 
C)  is liable only to the third party on the contract. 
D)  is personally liable to both the principal and the third person on the contract.

Question 18

If the principal is not disclosed,the agent is necessarily the other contracting party and is bound by the contract.

Accepted Answer

A) True 
 B)False

Question 19

Parol evidence is allowed to show whether an agent has signed in a representative or an individual capacity.

Accepted Answer

A) True 
 B)False

Question 20

An agent who commits a crime is:

Accepted Answer

A)  always liable. 
B)  only liable if acting in self-interest. 
C)  only liable if the act is done to advance the interest of the principal. 
D)  never liable when acting in the role of an agent . 
A)  always liable. 
B)  only liable if acting in self-interest. 
C)  only liable if the act is done to advance the interest of the principal. 
D)  never liable when acting in the role of an agent .

Exam 38: Third Persons in Agency

When a person purports to act as an agent for a principal,an implied warranty arises that such person has authority to do so.

If an agent commits a crime,the agent's liability will depend on the agency relationship.

John Smyth is an agent for L.T.Adams.To avoid becoming a party to any contract that Smyth signs for Adams,Smyth should sign in which of the following ways?

If an agent makes a properly authorized contract with a third person on behalf of a disclosed principal,the agent has no personal liability on the contract.

When a third person makes payment to an authorized agent,such payment is deemed made to the principal at the time the agent remits the payment to the principal.

An agent's liability as a party to a contract with a third person is not affected by the degree of disclosure.

Modern law holds that an employer is liable for an intentional tort committed by an employee for the purpose of furthering the employer's business.

The liability of a buyer for the purchase price of goods is terminated by the fact that the buyer gave the buyer's agent the purchase price to remit to the seller.

When a business owner uses an independent contractor to perform nonhazardous work,the owner ordinarily is:

Modern decisions hold the principal liable for which actions of the agent?

In a simple contract made by an authorized agent on behalf of a disclosed principal,the third person may sue either the agent or the principal in the event of a breach.

If a contract is ambiguous regarding whether the agent has signed in a representative or an individual capacity:

A(n)______________ principal is liable for a simple contract made by an authorized agent.

Different rules of law govern the vicarious liability of principals and employers.

Apparent authority has the same effect as:

In which of the following scenarios is the agent exposed to the greatest risk of liability?

An agent making a proper contract with a third person on behalf of a disclosed principal:

If the principal is not disclosed,the agent is necessarily the other contracting party and is bound by the contract.

Parol evidence is allowed to show whether an agent has signed in a representative or an individual capacity.

An agent who commits a crime is:

The Nature and Sources of Law

The Court System and Dispute Resolution

Business Ethics, Social Forces, and the Law

The Constitution As the Foundation of the Legal Environment

Government Regulation of Competition and Prices

Administrative Agencies

The Legal Environment of International Trade

Crimes

Torts

Intellectual Property Rights

Cyberlaw

Nature and Classes of Contracts: Contracting on the Internet

Formation of Contracts: Offer and Acceptance

Capacity and Genuine Assent

Consideration

Legality and Public Policy

Writing, Electronic Forms, and Interpretation of Contracts

Third Persons and Contracts

Discharge of Contracts

Breach of Contract and Remedies

Personal Property and Bailments

Legal Aspects of Supply Chain Management

Nature and Form of Sales

Title and Risk of Loss

Product Liability: Warranties and Torts

Obligations and Performance

Remedies for Breach of Sales Contracts

Kinds of Instruments, parties, and Negotiability

Transfers of Negotiable Instruments and Warranties of Parties

Liability of the Parties Under Negotiable Instruments

Checks and Funds Transfers

Nature of the Debtor-Creditor Relationship

Consumer Protection

Secured Transactions in Personal Property

Bankruptcy

Insurance

Agency

Regulation of Employment

Equal Employment Opportunity Law

Types of Business Organizations

Partnerships

LPs, LLCs, and LLPs

Corporate Formation

Shareholder Rights in Corporations

Securities Regulation

Accountants Liability and Malpractice

Management of Corporations

Real Property

Environmental Law and Land Use Controls

Leases

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