Richard writes a letter to Sarah authorizing her to sell his car and sends a copy of the letter to Timothy,a prospective purchaser.If the next day Richard sends a letter to Sarah revoking her authority,but he fails to notify Timothy,Sarah:
A) has actual authority to sell the car to Timothy.
B) has implied authority to sell the car to Timothy.
C) has apparent authority with respect to Timothy to sell the car.
D) is empowered under the doctrine of respondeat superior to negotiate the contract.

Question

Quizplus · Accepted Answer

Sarah has apparent authority with respect to Timothy to sell the car because Timothy had received a copy of the letter authorizing Sarah to sell the car before Richard revoked her authority. Timothy could reasonably assume that Sarah still had authority to sell the car, based on the previous communication he received from Richard. Therefore, Richard could be bound by a contract between Sarah and Timothy for the sale of the car, even though Richard had revoked Sarah's authority.

Richard Writes a Letter to Sarah Authorizing Her to Sell