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East Mississippi Community College ECON 2123 Chapter 38-THIRD PERSONS IN AGENCY TRUE/FALSE 1)The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract
East Mississippi Community College
ECON 2123
Chapter 38-THIRD PERSONS IN AGENCY
TRUE/FALSE
1)The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract.
- 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.
- Even after there is an effective ratification, the original action of an agent still is treated as unauthorized.
- 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's act causes loss to the third person, that third person may generally hold the agent liable for the loss.
- An agent's liability as a party to a contract with a third person is affected little by the degree of disclosure of 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.
- If the principal is not disclosed, the agent is necessarily the other contracting party and is bound to the contract.
- An agent should never sign a contract using "by" or "per" and then his or her name.
- Parol evidence is allowed to show whether an agent has signed in a representative or an individual capacity.
- If an agent commits a crime, the agent's liability will depend on the agency relationship.
- Agents are themselves liable for harm caused third persons by the agents' fraudulent, intentional, or negligent acts.
- A principal may be liable to a third person for an agent's unauthorized contracts.
- 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.
- Subject to certain limitations, a third person, on learning of the existence of an undisclosed principal, may sue the principal.
- 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 third person makes payment to an authorized agent, such payment is deemed made to the principal as of the time when the agent remits the payment to the principal.
- A principal is not bound by statements made by an agent during the transaction of business that is within the scope of the agent's authority.
- The principal is bound by knowledge but not by notice of any fact that is acquired by an agent while acting within the scope of actual or apparent authority.
- When a fact is known to the agent of a seller, but the seller actually is uninformed of such fact, the sale is deemed made by the seller with knowledge of that fact.
- The rule of law imposing vicarious liability on an innocent employer for the wrong of an employee is known as the doctrine of respondeat superior.
- The same rules of law govern the vicarious liability of principals and employers.
- An employer is clearly liable for any intentional, unprovoked assault committed by an employee on a third person.
- Vicarious liability will not be imposed on a principal unless the agent was acting within the scope of the agent's authority.
- Hiring an individual with a criminal record is conclusive proof that the employer is liable for the tort of negligent hiring.
- In general, a principal is liable for crimes of the agent committed while acting within the scope of the agency, even if the principal did not authorize commission of the crimes.
- An owner ordinarily is not liable for harm caused a third person by the negligence of an employee of an independent contractor.
- A customer who has given a purchase order to a salesperson is not bound by any contract until the employer of the salesperson accepts the order.
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