Question 1

Which statement is false regarding termination of agency based on operation of law?

Accepted Answer

A)When a new law makes the commission of an existing agency agreement illegal,
the agreement is terminated.
B)When a new law makes the commission of an existing agency agreement illegal,the agreement is terminated.
C)When a new law makes the commission of an existing agency agreement illegal,the agreement is terminated.
D)When a new law makes the commission of an existing agency agreement illegal,the agreement is terminated.
E)When a new law makes the commission of an existing agency agreement illegal,the agreement is terminated.

Question 2

How long does an agent's apparent authority continue once an agency relationship is terminated?

Accepted Answer

A)The agent's apparent authority continues until the principal notifies third parties
that the relationship has ended.
B)The agent's apparent authority continues until the principal notifies third parties that the relationship has ended.
C)The agent's apparent authority continues until the principal notifies third parties that the relationship has ended.
D)The agent's apparent authority continues until the principal notifies third parties that the relationship has ended.
E)The agent's apparent authority continues until the principal notifies third parties that the relationship has ended.

Question 3

Which of the following is false regarding revocation of the authority of an agent and renunciation by an agent?

Accepted Answer

A)If the agent has somehow breached the fiduciary duty to the principal,the principal can revoke the agent's authority without liability.
B)If the agent has somehow breached the fiduciary duty to the principal,the principal can revoke the agent's authority without liability.
C)If the agent has somehow breached the fiduciary duty to the principal,the principal can revoke the agent's authority without liability.
D)If the agent has somehow breached the fiduciary duty to the principal,the principal can revoke the agent's authority without liability.
E)If the agent has somehow breached the fiduciary duty to the principal,the principal can revoke the agent's authority without liability.

Question 4

Which of the following is an agency agreement created for the agent's benefit,not for the principal's?

Accepted Answer

A)An agency coupled with an interest is a special kind of agency relationship
created for the agent's benefit,not the principal's.
B)An agency coupled with an interest is a special kind of agency relationship created for the agent's benefit,not the principal's.
C)An agency coupled with an interest is a special kind of agency relationship created for the agent's benefit,not the principal's.
D)An agency coupled with an interest is a special kind of agency relationship created for the agent's benefit,not the principal's.
E)An agency coupled with an interest is a special kind of agency relationship created for the agent's benefit,not the principal's.

Question 5

Which of the following is true regarding the rights of an employer who is held liable and pays a third party,not because of the employer's negligence,but under the doctrine of respondeat superior based upon negligence of an employee?

Accepted Answer

A)If the third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
B)If the third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
C)If the third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
D)If the third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
E)If the third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.

Question 6

Which of the following holds the principal-employer liable for any harm caused by the agent-employee during the time that the agent-employee is working for the principal?

Accepted Answer

A)The principal/employer holds vicarious liability,which is liability assigned
without fault,for any harm the agent/employee causes while working for the principal.
B)The principal/employer holds vicarious liability,which is liability assigned without fault,for any harm the agent/employee causes while working for the principal.
C)The principal/employer holds vicarious liability,which is liability assigned without fault,for any harm the agent/employee causes while working for the principal.
D)The principal/employer holds vicarious liability,which is liability assigned without fault,for any harm the agent/employee causes while working for the principal.
E)The principal/employer holds vicarious liability,which is liability assigned without fault,for any harm the agent/employee causes while working for the principal.

Question 7

Which of the following refers to an employer's right,if any,to recover damages from an employee that the employer paid a third party as a result of the employee's negligence?

Accepted Answer

A)If a third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
B)If a third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
C)If a third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
D)If a third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.
E)If a third party is able to establish employee negligence such that the employer is liable,the employer has the right to recover from the employee any damages he paid the third party as a result of the employee's negligence.The right to recover damages is referred to as the right of indemnification.

Question 8

Which of the following is false regarding termination of agency in the Netherlands?

Accepted Answer

A)In the most interesting triggering event for mandatory compensation,the agent is entitled to "goodwill compensation" if 1)the agent brought the principal new customers,2)the agent brought new agreements with clients who are still profitable to the principal,and 3)such payment is financially reasonable for the principal the relationship is not being terminated due to bankruptcy).

Question 9

The most typical way to provide constructive notice of agency termination is ________.

Accepted Answer

A)Constructive notice usually consists of publication in a generally circulating
newspaper for the area where the agency agreement existed.
B)Constructive notice usually consists of publication in a generally circulating newspaper for the area where the agency agreement existed.
C)Constructive notice usually consists of publication in a generally circulating newspaper for the area where the agency agreement existed.
D)Constructive notice usually consists of publication in a generally circulating newspaper for the area where the agency agreement existed.
E)Constructive notice usually consists of publication in a generally circulating newspaper for the area where the agency agreement existed.

Question 10

[The Big Sale] Simone,the owner of ABC department store,needed to hire a number of employees in a hurry because of a big summer sale she was planning.Jamal was hired by Simone to run a cash register and to assist customers with taking large purchases to their cars.Jamal encountered a particularly annoying customer,Ryan.Ryan started complaining the minute he saw Jamal.Ryan complained about having to wait for Jamal to assist him with carrying his television purchase to his car,about the merchandise in the store,and about the quality of the store's employees.Jamal tried to control himself while he carted Ryan's television to the car;however,when Ryan began verbally attacking Jamal's appearance and professional manner,Jamal threw the television to the ground and punched Ryan in the nose.Ryan chose to investigate Jamal's employment history and discovered that Jamal had been fired from his previous three jobs for taking violent action against customers.Two of his former employers were willing to testify that if Simone had called them,they would have disclosed Jamal's tendencies to her.Jamal listed the former employers on his application,but because she was in a hurry to hire employees,Simone did not take the time to check with the former employers.Another problem confronting Simone during the big sale is that Lea,a long-time employee of Simone who had never caused any problems before,accidentally,but negligently,dropped a box on the foot of a customer,Greg.Greg had to have an X-ray and is threatening to sue both Simone and Lea.
-Which of the following is true regarding Simone's liability,if any,for her own conduct in regards to Ryan's injury?

Accepted Answer

A)A principal may be liable for negligent hiring who fails to do a background check to learn about the tendencies of potential employees.
B)A principal may be liable for negligent hiring who fails to do a background check to learn about the tendencies of potential employees.
C)A principal may be liable for negligent hiring who fails to do a background check to learn about the tendencies of potential employees.
D)A principal may be liable for negligent hiring who fails to do a background check to learn about the tendencies of potential employees.
E)A principal may be liable for negligent hiring who fails to do a background check to learn about the tendencies of potential employees.

Question 11

In Iglesia Cristiana La Casa Del Senor Inc. ,Etc.v.L.M. ,the case in the text in which an alleged victim sued the former pastor and a church,alleging the pastor had sexually assaulted her when she was a minor,which of the following was the result?

Accepted Answer

A)The court ruled that the offense did not occur within the scope of his employment and that "the Church cannot be held vicariously liable for Pacheco's [the priest's] criminal act."
B)The court ruled that the offense did not occur within the scope of his employment and that "the Church cannot be held vicariously liable for Pacheco's [the priest's] criminal act."
C)The court ruled that the offense did not occur within the scope of his employment and that "the Church cannot be held vicariously liable for Pacheco's [the priest's] criminal act."
D)The court ruled that the offense did not occur within the scope of his employment and that "the Church cannot be held vicariously liable for Pacheco's [the priest's] criminal act."
E)The court ruled that the offense did not occur within the scope of his employment and that "the Church cannot be held vicariously liable for Pacheco's [the priest's] criminal act."

Question 12

If a manager has business transactions in one of the European Union countries and wants to terminate an agency relationship,he or she would want to have access to knowledge about which of the following?

Accepted Answer

A)A U.S.manager conducting business in the European Union needs access to the
intricacies of Chapter IV of the Agency Relationship Law that focuses on termination.
B)A U.S.manager conducting business in the European Union needs access to the intricacies of Chapter IV of the Agency Relationship Law that focuses on termination.
C)A U.S.manager conducting business in the European Union needs access to the intricacies of Chapter IV of the Agency Relationship Law that focuses on termination.
D)A U.S.manager conducting business in the European Union needs access to the intricacies of Chapter IV of the Agency Relationship Law that focuses on termination.
E)A U.S.manager conducting business in the European Union needs access to the intricacies of Chapter IV of the Agency Relationship Law that focuses on termination.

Question 13

While making a delivery,Elliott,a delivery driver for Sira's Sandwiches,went through the drive through at a local restaurant to get a cup of coffee and bumped into the car in front of him resulting in some damage to the car's bumper.Which of the following is true regarding the liability of Sira's Sandwiches for the damage to the car?

Accepted Answer

A)If an agent makes a substantial departure from the course of the employer's business,the employer is not liable.
B)If an agent makes a substantial departure from the course of the employer's business,the employer is not liable.
C)If an agent makes a substantial departure from the course of the employer's business,the employer is not liable.
D)If an agent makes a substantial departure from the course of the employer's business,the employer is not liable.
E)If an agent makes a substantial departure from the course of the employer's business,the employer is not liable.

Question 14

Which of the following is not necessarily a means an agency relationship may be terminated?

Accepted Answer

A)An agency relationship can be terminated in a number of ways including
fulfillment of purpose,occurrence of a specific event,revocation of authority,and renunciation by the agent.Insolvency,the inability to pay debts or the condition in which liabilities outweigh assets,does not necessarily result in the termination of the agency relationship.

Question 15

Which of the following is true regarding notice of termination of an agency relationship?

Accepted Answer

A)Depending on the circumstances,notice of termination can be actual or constructive.
B)Depending on the circumstances,notice of termination can be actual or constructive.
C)Depending on the circumstances,notice of termination can be actual or constructive.
D)Depending on the circumstances,notice of termination can be actual or constructive.
E)Depending on the circumstances,notice of termination can be actual or constructive.

Question 16

Regarding the relationship between a principal and an independent contractor,which of the following statements is false?

Accepted Answer

A)If the independent contractor engages in extremely hazardous activities,such as blasting operations,for the principal,the principal will be responsible for any damages by the independent contractor.
B)If the independent contractor engages in extremely hazardous activities,such as blasting operations,for the principal,the principal will be responsible for any damages by the independent contractor.
C)If the independent contractor engages in extremely hazardous activities,such as blasting operations,for the principal,the principal will be responsible for any damages by the independent contractor.
D)If the independent contractor engages in extremely hazardous activities,such as blasting operations,for the principal,the principal will be responsible for any damages by the independent contractor.
E)If the independent contractor engages in extremely hazardous activities,such as blasting operations,for the principal,the principal will be responsible for any damages by the independent contractor.

Question 17

Which of the following is true regarding whether Jason is liable to Sakura for the cost of the book if Sakura pays Gwen the purchase price?

Accepted Answer

A)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.Yet,if the agent is liable to the third party,then the undisclosed principal is liable to the agent.
B)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.Yet,if the agent is liable to the third party,then the undisclosed principal is liable to the agent.
C)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.Yet,if the agent is liable to the third party,then the undisclosed principal is liable to the agent.
D)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.Yet,if the agent is liable to the third party,then the undisclosed principal is liable to the agent.
E)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.Yet,if the agent is liable to the third party,then the undisclosed principal is liable to the agent.

Question 18

Which of the following is true regarding whether Sakura is personally bound on the contract with Gwen?

Accepted Answer

A)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.
B)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.
C)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.
D)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.
E)When the agent acts within her authority on behalf of an undisclosed principal,the law will likely hold her liable for the agreement.In the eyes of the third party,the agent is the only person who could be liable.

Question 19

[Textbook Confusion] Jason needs a business law book.He hears that Gwen has one for sale.Jason asks his girlfriend Sakura to buy it for him from Gwen if Sakura can get it for under $40.Sakura sees Gwen in the hall and asks if she will sell the book for $30,and Gwen agrees.They are between classes,and Sakura does not mention that the book is for Jason,although all the parties were on good terms,and the identity of the buyer should not have affected Sakura's agreement.Later,however,Rima agrees to give Jason her used business law book.Jason tells Sakura that he no longer wants the book.Sakura tells Gwen about the situation with Jason.Gwen replies that she does not care if Jason wants the book or not.Gwen says that she passed up a couple of opportunities to sell the book because she thought she already had it sold and that she wants her money from either Gwen or Jason - she doesn't care who pays.
-When Sakura and Gwen enter their agreement,what type of principal is Jason?

Accepted Answer

A)If the third party does not know that an agent is acting on behalf of a principal,
we have an undisclosed principal.
B)If the third party does not know that an agent is acting on behalf of a principal,we have an undisclosed principal.
C)If the third party does not know that an agent is acting on behalf of a principal,we have an undisclosed principal.
D)If the third party does not know that an agent is acting on behalf of a principal,we have an undisclosed principal.
E)If the third party does not know that an agent is acting on behalf of a principal,we have an undisclosed principal.

Question 20

According to the text,which of the following is not a factor considered by courts in determining whether an act committed by an employee occurred within the course and scope of employment?

Accepted Answer

A)A number of factors are considered by the court in determining whether an act committed by an employee occurred within the course and scope of employment including whether the employer authorized the employee's act,whether the employer provided the means tools)by which the act occurred,and whether the employer know that the act would include the commission of a serious crime.
The length of time the employee worked for the employer is not listed an element considered by the court.
B)A number of factors are considered by the court in determining whether an act committed by an employee occurred within the course and scope of employment including whether the employer authorized the employee's act,whether the employer provided the means tools)by which the act occurred,and whether the employer know that the act would include the commission of a serious crime.The length of time the employee worked for the employer is not listed an element considered by the court.
C)A number of factors are considered by the court in determining whether an act committed by an employee occurred within the course and scope of employment including whether the employer authorized the employee's act,whether the employer provided the means tools)by which the act occurred,and whether the employer know that the act would include the commission of a serious crime.The length of time the employee worked for the employer is not listed an element considered by the court.
D)A number of factors are considered by the court in determining whether an act committed by an employee occurred within the course and scope of employment including whether the employer authorized the employee's act,whether the employer provided the means tools)by which the act occurred,and whether the employer know that the act would include the commission of a serious crime.The length of time the employee worked for the employer is not listed an element considered by the court.
E)A number of factors are considered by the court in determining whether an act committed by an employee occurred within the course and scope of employment including whether the employer authorized the employee's act,whether the employer provided the means tools)by which the act occurred,and whether the employer know that the act would include the commission of a serious crime.The length of time the employee worked for the employer is not listed an element considered by the court.

Quiz 34: Liability to Third Parties and Termination