Jones acted as Blake's agent for 12 years before this contract of agency was dissolved by Blake. However, Blake failed to convey this fact to those vendors with whom Jones contracted in the past. Which of the following is likely to occur if Jones negotiates future contracts with these vendors on Blake's behalf?
A)Blake can rescind those contracts since Jones is no longer an agent.
B)Blake can sue the vendors for contracting without authorization.
C)Blake would be bound by those contracts and would have to pay the contracted price.
D)Blake can claim compensation from Jones for any profits made.

Question

Quizplus · Accepted Answer

Blake would be bound by those contracts because he failed to notify the vendors of the termination of Jones's agency. In the eyes of the vendors, Jones still appears to have the authority to act on Blake's behalf, making Blake liable for the contracts Jones enters into.

Jones Acted as Blake's Agent for 12 Years Before This