Which of the following statements is true about apparent authority?
A) Only a general agent can have apparent authority.
B) Only a special agent can have apparent authority.
C) If the agent justifiably believed he or she had authority, this authority would be apparent.
D) If a third party justifiably believed the agent had authority, the agent's authority would be apparent.

Question

Quizplus · Accepted Answer

The test used for determining the extent of an agent's apparent authority is the justifiable belief of a third party dealing with the agent. It is important to note that if the agent justifiably believed she had authority, her authority would be implied, not apparent. This distinction can be very important because an agent's exercise of apparent authority, in the absence of actual authority, is in violation of the agent's duty to the principal.

Which of the Following Statements Is True About Apparent Authority