Deck 16: Management of Employee Conduct: Agency

Question 1

Implied authority is the extension of express authority by custom.

Answer 1

True

Question 2

In a master/servant relationship,the principal is liable for the torts of the agent committed within the scope of employment.

Answer 2

True

Question 3

A principal cannot ratify an act of an agent retroactively.

Answer 3

False

Question 4

An agency at will is a relationship in which there is no definite ending date.

Question 5

In an agency relationship,both the principal and agent must have legal capacity.

Question 6

An unincorporated association is a group that acts as an entity but has no legal existence.

Question 7

Apparent authority and agency by estoppel are the same thing.

Question 8

In a master/servant relationship,the principal exercises little control over the agent.

Question 9

An independent contractor is not controlled directly by the principal.

Question 10

A real estate agent who fails to disclose his interest as a buyer to his seller principal has violated his duty of loyalty.

Question 11

The public policy exception to employment at will does not afford protection for whistle-blowers.

Question 12

The presence of a master-servant relationship determines whether or not a principal must pay wage taxes and withhold income taxes.

Question 13

The ability of a clerk in a store to accept payment for goods is an example of implied authority.

Question 14

The Restatement of Agency has been adopted in all states.

Question 15

A principal is not liable for an accident caused by its delivery person.

Question 16

Personnel manuals have been held to constitute an employee contract.

Question 17

Ratification requires full knowledge of the transaction.

Question 18

Express authority must be in writing.

Question 19

An agency contract must be evidenced by a record to be valid.

Question 20

There is no liability of employers for the acts of independent contractors.

Question 21

Agents are liable to principals for negligence in performing their duties.

Question 22

Agents can collect payoffs made during the course of conducting the principal's business.

Question 23

A gratuitous agency is void.

Question 24

Unless protected by a statute,an agent for an unincorporated association has full liability on contracts entered into on behalf of that association.

Question 25

Public notice of termination of an agent is not required.

Question 26

Principals and agents have a fiduciary relationship.

Question 27

Apparent authority ends when an agent is fired.

Question 28

Firing an agent does not end apparent authority.

Question 29

Ratification of a contract by a principal releases the agent from all liability to the third party.

Question 30

A master-servant relationship is one in which the principal has little control over the agent.

Question 31

Constructive notice of termination of an agent is public notice.

Question 32

Express and implied authority together are called real authority.

Question 33

All states recognize non-compete agreements as enforceable contract clauses.

Question 34

Agents in undisclosed principal situations never have personal liability.

Question 35

The intentional torts of agents are never the responsibility of the principal.

Question 36

The employment-at-will doctrine prohibits the firing of nonunion or noncontract employees.

Question 37

Apparent authority ends when an agent quits.

Question 38

A gratuitous agency is one in which the agent is not paid.

Question 39

In a fully disclosed principal situation in which the agent is acting with authority,only the principal is liable on the contract.

Question 40

Courts view non-compete agreements against the employees and for the employers.

Question 41

Express authority:

A)must be in writing.
B)can limit the agent's authority.
C)includes customary authority.
D)none of the above

Question 42

Real estate agents would not customarily have the authority to enter into sales contracts for their clients.

Question 43

An employee who is asked to take company cash to the bank on his lunch hour is not in the scope of employment during that lunch hour.

Question 44

There is no apparent authority in an undisclosed principal relationship.

Question 45

A real estate agent who represents both buyer and seller in a transaction without disclosure to both has breached the duty of loyalty.

Question 46

Post-employment non-compete agreements are unenforceable.

Question 47

An employer is only liable for its actions when hiring,not its failure to do something.

Question 48

Post-employment non-compete agreements are void.

Question 49

A power of attorney is an example of an agency relationship.

Question 50

The Uniform Unincorporated Nonprofit Association Act provides for limited liability of the members of a nonprofit organization that is not incorporated.

Question 51

Respondeat superior is no longer applied in agency relationships.

Question 52

There is no employer liability for negligent hiring.

Question 53

Which is not an example of an independent contractor relationship?

A)master/servant
B)lawyer/client
C)accountant/client
D)All of the above are not independent contractors.

Question 54

The Restatement of Agency:

A)is a summary of the common law agency.
B)has been adopted in all states.
C)is legislative law.
D)none of the above

Question 55

The duty of loyalty of an agent to a principal does not cover conflicts of interest.

Question 56

A sales clerk at a department store is an example of an independent contractor.

Question 57

"I'll make good on my employee's promise," is an example of a ratification.

Question 58

"Talk to Ann.She used to work here,but I think she is the best one to get this deal done for us," is an example of express authority given to an agent.

Question 59

An independent contractor is not an agent of the principal.

Question 60

Which is a requirement for the creation of an agency relationship?

A)a written agreement
B)principal with capacity
C)agent with capacity
D)none of the above

Question 61

In which of the following situations is an agent liable to third parties?

A)in a situation where there is a fully disclosed principal but only apparent authority
B)in a situation where there is a fully disclosed principal but only implied authority
C)in a situation where the principal is an unincorporated association
D)all of the above

Question 62

Haskins is an officer of a real estate development firm.Haskins purchased a piece of property in a rural area of Arizona with the idea of building resort homes there.The firm has always had board resolutions for purchases of property (as is common practice)but there was no resolution for this property purchase.The other officers in the firm have learned of the value of the property and are concerned that the firm may not own the property.Which of the following statements is true?

A)The firm can ratify Haskin's actions and take over the contract.
B)The firm cannot ratify the contract unless Haskins had express authority to buy land.
C)If the firm ratifies the contract, the effect is that Haskins is released from liability on it.
D)none of the above

Question 63

A fiduciary is required to:

A)act in the best interests of the principal.
B)eliminate all risk for the principal.
C)hire a trustee to supervise the funds involved that belong to the principal.
D)none of the above

Question 64

Russ Belmont is a staff accountant at a bank in the downtown Phoenix area.Belmont is sent to various branches throughout the state to do audits and has an accident while en route to one of the audits.Which of the following statements is true?

A)The bank will be liable for any injuries to third parties.
B)The bank will not be liable for any injuries to third parties.
C)Belmont is a professional and an independent contractor and the bank will not be liable.
D)none of the above

Question 65

An employment-at-will relationship is:

A)one in which there is a definite ending date.
B)rare in the employment market.
C)now illegal.
D)none of the above

Question 66

If the act of an agent is ratified:

A)there is retroactive authority for the act.
B)the principal has agreed to allow the agent to be liable.
C)the agent then has express authority for that act in the future.
D)none of the above

Question 67

The public policy exception to the employment-at-will doctrine protects:

A)employees who are fired with cause.
B)employees who engage in illegal conduct.
C)whistle-blowers.
D)none of the above

Question 68

Under apparent authority:

A)a principal is never liable for the acts of an agent.
B)a principal is liable for creating the appearance of an agency relationship.
C)there is no agency relationship.
D)none of the above

Question 69

In which of the following situations does the agent have no liability to third parties?

A)contract entered into with express authority and a fully disclosed principal
B)contract entered into with no authority but later ratified in full by the principal
C)contract entered into for a corporation before the corporation was formed but with full knowledge and support of the incorporators
D)The agent has no liability in any of the above.

Question 70

Which of the following is necessary to create an agency relationship?

A)consideration
B)an agent with contractual capacity
C)a ratification by the principal
D)none of the above

Question 71

An unincorporated association:

A)has no liability for its members.
B)is not a principal with capacity.
C)can have agents.
D)none of the above

Question 72

Jane and Joseph Sechrist signed a contract to have a swimming pool built in their backyard for $10,000.The salesman for the pool company signed the contract as well on a space marked "Salesperson." Two days after the contract was signed,the salesman called the Sechrists back and asked them to come in and sign a new contract for $11,000 because the vice president had not approved the original price.Jane has checked the contract and discovered that there is no language that requires the approval of anyone other than the salesperson.Jane and Joseph can have their pool built for $10,000 because:

A)the pool company was bound once Jane and Joe signed the contract.
B)the pool company has ratified the contract.
C)of misrepresentation.
D)the salesman had at least apparent authority to bind the pool company.

Question 73

Russ Belmont is a staff accountant at a bank in the downtown Phoenix area.Belmont commutes to the bank each day from his suburban home in Mesa - a distance of 19 miles each way.Belmont's working hours are 8:00 AM to 5:00 PM and he commutes from 7:15 AM until he reaches the bank's parking garage between 7:45 and 8:00 (depending upon the traffic).If Russ is in an accident while on the freeway at 7:30 AM:

A)the bank will be liable for any injuries to third parties.
B)the bank will not be liable for any injuries to third parties.
C)Belmont is an independent contractor and the bank will have no liability for injuries or damages in the accident.
D)none of the above

Question 74

Principals are liable for the acts of independent contractors if:

A)the acts are inherently dangerous activities.
B)the independent contractor was negligently hired.
C)both a and b
D)none of the above

Question 75

Mary Scott was hired to manage the Cactus Cart,a tiny kiosk located in Sky Harbor Airport in Phoenix.No specific duties were listed,but the business owner who hired Mary told her,"Just sell the plants and deposit the money." Mary would have the implied authority to:

A)take checks as payment.
B)change the business name.
C)sell the kiosk.
D)all of the above

Question 76

Which is a requirement for establishing apparent authority?

A)underlying express authority
B)an agency agreement
C)both a and b
D)none of the above

Question 77

Gilda Steinforth is a partner in the law firm of Jones,Deloitte & Ernst.A wealthy couple has met with her and asked her to draw up a trust for a portion of their property.They gave Steinforth a check for $10,000 as a retainer fee and a check for $500,000 to begin the trust.Within two days after her meeting with the couple,Gilda and the checks are gone.The couple wishes to recover from Jones,Deloitte & Ernst.Which of the following statements is true?

A)The couple may not recover since Jones, Deloitte & Ernst is not responsible for the intentional torts of its employees.
B)The couple may not recover since Steinforth, as a lawyer, was an independent contractor and not a servant of the firm.
C)The couple may not recover since Steinforth had no express or implied authority to receive the checks.
D)none of the above

Question 78

In a master-servant relationship,the principal most likely will need to do which of the following?

A)Withhold income taxes for the agent
B)Pay FICA for the agent
C)Pay FUTA for the agent
D)All of these

Question 79

A personnel manual:

A)can constitute a contract in an employment-at-will relationship.
B)can disclaim any promises made therein.
C)is never a contract.
D)none of the above

Question 80

The purpose of anti-retaliation statutes is to protect:

A)employers from whistle-blowing employees.
B)government agencies from suit in the event a private employer is investigated because of an employee's claim.
C)whistle-blowing employees.
D)none of the above