Exam 38: Third Persons in Agency

The fact that a tort or crime is committed by an employee imposes vicarious liability on an employer.

Tom Creighton hired Destroy,Inc. ,a demolition company,to level an old building on a busy downtown lot.Destroy,Inc.was given full rein to decide on the amount of explosives needed and the placement of the charges.Security for the site on the day of the explosion was contracted out to a private security firm.When the appointed day arrived,the building was brought down.However,the building fell in a slightly different direction than that anticipated by Destroy,Inc.Numerous pieces of adjoining property,both real and personal,were severely damaged.Creighton claims that the use of an independent contractor such as Destroy,Inc.has insulated him from liability.How do you respond to Creighton's claim?

Even after there is an effective ratification,the original action of an agent still is treated as unauthorized.

Pamela was the agent in charge of distribution and collections for the Coble Dairy Products Cooperative.Thrower operated a grocery store and purchased dairy products from Coble.Pamela made false invoice sheets,showing delivery to Thrower of greater quantities than Thrower actually had ordered or received.Pamela collected from Thrower on the basis of these increased amounts,and then kept for herself the difference between the increased amounts and the amounts that should have been charged.When Thrower learned of this,he sued Coble for the excess payments he had made.Coble denied that Pamela was its agent in making excess collections.Will Thrower win?

The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract.

Which of the following is a defense to an action against an agent for breach of the implied warranty of authority?

Subject to certain limitations,a third person,on learning of the existence of an undisclosed principal,may sue the principal.

A third person dealing with the agent of a disclosed principal ordinarily intends to make a contract with the principal,not the agent.

In the partially disclosed principal situation,the agent is considered a party to the contract.

Agent's may intentionally make themselves liable on contracts with third persons.

The agent of a disclosed principal is liable for harm caused to third persons by:

An agent should never sign a contract using "by" or "per" and then his or her name.

An owner ordinarily is not liable for harm caused a third person by the negligence of an employee of an independent contractor.