Question 1

Largo is an agent for MaryElise.MaryElise gives Largo clear instructions to enter into contracts on her behalf only on Mondays,Wednesdays,or Fridays.Largo enters into a contract on her behalf on Tuesday.Largo has breached​

Accepted Answer

Largo has breached the duty of obedience as he did not follow the clear instructions given by MaryElise to enter into contracts only on Mondays, Wednesdays, or Fridays.

Question 2

Ben manages a warehouse and its inventory for Coffee Shops,Inc.To operate this part of the business,Ben's authority can be inferred​

Accepted Answer

The answer of Ben manages a warehouse and its inventory...

Question 3

Bernard is an expert on exotic flowers.Custom Floral Arrangements,Inc. ,hires Bernard to order exotic flowers for its arrangements.Bernard does not examine the quality of the flowers he orders on behalf of Custom Floral.Bernard has breached​

Accepted Answer

Bernard has breached the duty of performance by failing to examine the quality of the flowers he orders on behalf of Custom Floral. As an expert in exotic flowers, it was his responsibility to ensure that the flowers ordered were of the expected quality.

Question 4

Spicy Hot Dog Vendors,Inc. ,grants its agent Teona an exclusive territory in which to sell Spicy products.Spicy's attempt to compete with Teona in that territory would most likely violate​

Accepted Answer

Spicy's attempt to compete with Teona in the exclusive territory would likely violate the duty of cooperation. This duty requires the principal (Spicy) to not interfere with the agent's (Teona's) ability to perform their duties, including respecting the exclusivity of their territory.

Question 5

Fact Pattern 19-2
Faye works as an administrator and receptionist for Garage Door Store.The store withholds federal taxes from Faye's pay,and controls the methods and details of the performance of her work.Faye is not authorized to modify the prices or other terms of a sale at the store.Homer installs Garage Door products at the buyers' locations.
-Refer to Fact Pattern 19-2.Garage Door hires Janitorial Service Company to clean the store.Garage Door gives Janitorial Service instructions as to what needs to be cleaned and when.With respect to Garage Door,Janitorial Service is​

Accepted Answer

Janitorial Service Company is an independent contractor because Garage Door Store controls the result of the work (what needs to be cleaned and when) but not the methods or details of how the cleaning is performed.

Question 6

Insurance Sales Corporation hires Jeremy to act as its agent.Insurance Sales's right not to perform a contract entered into by Jeremy,if he breaches their agency agreement,is the right of​

Accepted Answer

The right of avoidance allows a principal, in this case, Insurance Sales Corporation, to refuse to perform a contract entered into by its agent, Jeremy, if he breaches their agency agreement. This right is exercised to avoid the obligations of a contract that was entered into by an agent who was not acting within the scope of their authority or who violated the terms of the agency agreement.

Question 7

Lynn,an agent for Mindwonder Games LLC,executes an unauthorized contract with NOW Marketing Inc.The deal is highly advantageous to Mindwonder,and the company ratifies the contract.The contract is​

Accepted Answer

The contract is valid because the company (principal) ratified the contract after Lynn (agent) executed it, even though it was unauthorized. Ratification makes the contract legally binding.

Question 8

Watercraft,Inc. ,employs Vladimir as a sales agent for a trial period.At the end of the period,Watercraft and Vladimir disagree on the amount of the commissions Vladimir is due for sales that he made.Vladimir may demand​

Accepted Answer

Vladimir can demand an accounting to determine the amount of commissions he is owed. An accounting will help determine the exact amount of sales made by Vladimir and the corresponding commissions due.

Question 9

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​

Accepted Answer

Indemnification is the right to hold someone else (in this case, Kelly) liable for damages or losses incurred as a result of their breach of contract. John made a deal with Lawson at the request of Kelly, and Kelly failed to pay the rest of the price. Therefore, John has the right to seek indemnification from Kelly for any damages or losses he incurs as a result of Lawson's lawsuit.

Question 10

Business Travelers Hotel Corporation hires Conrad,a real estate agent,to locate hotel properties for the company.Conrad learns of a hotel available for $3.2 million,informs Business Travelers,and makes an offer of $2.9 million on Business Travelers's instruction.The offer is rejected.Conrad​

Accepted Answer

Conrad followed the instructions of Business Travelers Hotel Corporation by making an offer on the property as directed, which demonstrates compliance with his duties as an agent to act on behalf of and for the benefit of the principal.

Question 11

Kevin is an agent for Lookout Mountain Accountants,Inc.On Lookout Mountain's behalf and at its request,Kevin pays Nathan for software designed for the management of Lookout Mountain's services.Kevin's right to obtain the amount of those payments from Lookout Mountain arises under the principal's duty of​

Accepted Answer

Kevin has paid Nathan for software designed for the management of Lookout Mountain's services at Lookout Mountain's request. Therefore, Lookout Mountain has a duty to reimburse Kevin for the amount of those payments. This duty arises under the principal's duty of reimbursement, which is a type of duty of indemnification. Therefore, the correct choice is D, reimbursement.

Question 12

Flo,an agent for Grover,enters into a contract on Grover's behalf with Hong that must be in writing to be enforceable under the Statute of Frauds.Failure to comply with the equal dignity rule,with respect to this contract,can make the contract voidable at the option of​

Accepted Answer

The equal dignity rule requires that contracts that must be in writing under the Statute of Frauds must also be authorized in writing by the party who is seeking to enforce the contract. In this case, Flo is acting as Grover's agent and entering into a contract on his behalf that must be in writing. Therefore, in order for the contract to be enforceable, Grover must authorize the contract in writing. Failure to comply with the equal dignity rule can make the contract voidable at the option of Grover, who is the party who authorized the contract to be entered into on his behalf.

Question 13

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

Accepted Answer

An agency relationship can be created for any legal purpose, as long as it is not for an illegal activity. Both Denny and Ethel have professional backgrounds and may decide to work together for a legal business purpose, but they also have the option to create an agency relationship for other legal purposes such as investing in real estate or starting a business.

Question 14

Fact Pattern 19-2
Faye works as an administrator and receptionist for Garage Door Store.The store withholds federal taxes from Faye's pay,and controls the methods and details of the performance of her work.Faye is not authorized to modify the prices or other terms of a sale at the store.Homer installs Garage Door products at the buyers' locations.
-Rosario is a chef and caterer who hires out on a per-project basis to companies with on-location work sites,as well as to hosts of banquets,corporate meetings,concerts,weddings,and other events.In this capacity,Rosario is

Accepted Answer

Rosario is hired on a per-project basis and serves multiple clients in various settings, which indicates that she is an independent contractor.

Question 15

Norton grants an ordinary power of attorney to Olena to locate potential real estate investment opportunities on Norton's behalf.This power will terminate on Norton's​

Accepted Answer

An ordinary power of attorney is terminated by the death or incapacity of the principal, so in this case, it will terminate on Norton's death or incapacity. The other options do not apply to an ordinary power of attorney.

Question 16

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​

Accepted Answer

Roberta's introduction of Steve as "my associate" to her friends could lead them to reasonably believe that Steve has the authority to act on her behalf, making her liable for his actions under the principle of agency by estoppel. This occurs when a principal's behavior causes a third party to believe that an agent has authority, even if no formal agreement exists.

Question 17

Lucille is married to Marcus.Lucille buys food for their children's lunches and charges the cost to Marcus's account.This is​

Accepted Answer

This is an example of an agency by operation of law, where the law recognizes an agency relationship to prevent injustice or to fulfill social or policy obligations, such as a spouse making necessary purchases for the family's welfare.

Question 18

Based on Oona's conduct,Porcio reasonably believes that Qasim has the authority to act on Oona's behalf even though Qasim does not have the actual authority to do so.In this circumstance,Qasim has​

Accepted Answer

Porcio believes that Qasim has the authority to act on Oona's behalf based on Oona's conduct, which creates the appearance of authority. This is known as apparent authority. Qasim may not have actual authority, but Oona's actions have led Porcio to reasonably believe that Qasim does have the authority to act on her behalf.

Question 19

Ingmar asks Jessie to contract with Jessie's high school classmates to babysit Ingmar's new baby.Jessie orally agrees to do so.This is​

Accepted Answer

This is an agency by agreement because Jessie has agreed to provide babysitting services for Ingmar's baby on behalf of Ingmar. The agreement can be oral or written.

Question 20

Donald approves on behalf of Evelyn-but without authorization-a contract with Farouk to build a new silo.Evelyn does not ratify the contract.The deal with Farouk is​

Accepted Answer

The answer of Donald approves on behalf of Evelyn-but without...

Quiz 19: Agency Relationships

Largo is an agent for MaryElise.MaryElise gives Largo clear instructions to enter into contracts on her behalf only on Mondays,Wednesdays,or Fridays.Largo enters into a contract on her behalf on Tuesday.Largo has breached​

Ben manages a warehouse and its inventory for Coffee Shops,Inc.To operate this part of the business,Ben's authority can be inferred​

Bernard is an expert on exotic flowers.Custom Floral Arrangements,Inc. ,hires Bernard to order exotic flowers for its arrangements.Bernard does not examine the quality of the flowers he orders on behalf of Custom Floral.Bernard has breached​

Spicy Hot Dog Vendors,Inc. ,grants its agent Teona an exclusive territory in which to sell Spicy products.Spicy's attempt to compete with Teona in that territory would most likely violate​

Insurance Sales Corporation hires Jeremy to act as its agent.Insurance Sales's right not to perform a contract entered into by Jeremy,if he breaches their agency agreement,is the right of​

Lynn,an agent for Mindwonder Games LLC,executes an unauthorized contract with NOW Marketing Inc.The deal is highly advantageous to Mindwonder,and the company ratifies the contract.The contract is​

Watercraft,Inc. ,employs Vladimir as a sales agent for a trial period.At the end of the period,Watercraft and Vladimir disagree on the amount of the commissions Vladimir is due for sales that he made.Vladimir may demand​

Business Travelers Hotel Corporation hires Conrad,a real estate agent,to locate hotel properties for the company.Conrad learns of a hotel available for $3.2 million,informs Business Travelers,and makes an offer of $2.9 million on Business Travelers's instruction.The offer is rejected.Conrad​

Flo,an agent for Grover,enters into a contract on Grover's behalf with Hong that must be in writing to be enforceable under the Statute of Frauds.Failure to comply with the equal dignity rule,with respect to this contract,can make the contract voidable at the option of​

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

Norton grants an ordinary power of attorney to Olena to locate potential real estate investment opportunities on Norton's behalf.This power will terminate on Norton's​

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​

Lucille is married to Marcus.Lucille buys food for their children's lunches and charges the cost to Marcus's account.This is​

Based on Oona's conduct,Porcio reasonably believes that Qasim has the authority to act on Oona's behalf even though Qasim does not have the actual authority to do so.In this circumstance,Qasim has​

Ingmar asks Jessie to contract with Jessie's high school classmates to babysit Ingmar's new baby.Jessie orally agrees to do so.This is​

Donald approves on behalf of Evelyn-but without authorization-a contract with Farouk to build a new silo.Evelyn does not ratify the contract.The deal with Farouk is​

Largo is an agent for MaryElise.MaryElise gives Largo clear instructions to enter into contracts on her behalf only on Mondays,Wednesdays,or Fridays.Largo enters into a contract on her behalf on Tuesday.Largo has breached

Ben manages a warehouse and its inventory for Coffee Shops,Inc.To operate this part of the business,Ben's authority can be inferred

Bernard is an expert on exotic flowers.Custom Floral Arrangements,Inc. ,hires Bernard to order exotic flowers for its arrangements.Bernard does not examine the quality of the flowers he orders on behalf of Custom Floral.Bernard has breached

Spicy Hot Dog Vendors,Inc. ,grants its agent Teona an exclusive territory in which to sell Spicy products.Spicy's attempt to compete with Teona in that territory would most likely violate

Insurance Sales Corporation hires Jeremy to act as its agent.Insurance Sales's right not to perform a contract entered into by Jeremy,if he breaches their agency agreement,is the right of

Lynn,an agent for Mindwonder Games LLC,executes an unauthorized contract with NOW Marketing Inc.The deal is highly advantageous to Mindwonder,and the company ratifies the contract.The contract is

Watercraft,Inc. ,employs Vladimir as a sales agent for a trial period.At the end of the period,Watercraft and Vladimir disagree on the amount of the commissions Vladimir is due for sales that he made.Vladimir may demand

Business Travelers Hotel Corporation hires Conrad,a real estate agent,to locate hotel properties for the company.Conrad learns of a hotel available for $3.2 million,informs Business Travelers,and makes an offer of $2.9 million on Business Travelers's instruction.The offer is rejected.Conrad

Flo,an agent for Grover,enters into a contract on Grover's behalf with Hong that must be in writing to be enforceable under the Statute of Frauds.Failure to comply with the equal dignity rule,with respect to this contract,can make the contract voidable at the option of

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

Norton grants an ordinary power of attorney to Olena to locate potential real estate investment opportunities on Norton's behalf.This power will terminate on Norton's

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

Lucille is married to Marcus.Lucille buys food for their children's lunches and charges the cost to Marcus's account.This is

Based on Oona's conduct,Porcio reasonably believes that Qasim has the authority to act on Oona's behalf even though Qasim does not have the actual authority to do so.In this circumstance,Qasim has

Ingmar asks Jessie to contract with Jessie's high school classmates to babysit Ingmar's new baby.Jessie orally agrees to do so.This is

Donald approves on behalf of Evelyn-but without authorization-a contract with Farouk to build a new silo.Evelyn does not ratify the contract.The deal with Farouk is