Roberta introduces Steve to her friends as "my associate." Steve purports to act as Roberta's agent in several business transactions with those friends. If Roberta is liable for Steve's actions, it will be because their relationship is

Question

Roberta introduces Steve to her friends as "my associate." Steve purports to act as Roberta's agent in several business transactions with those friends. If Roberta is liable for Steve's actions, it will be because their relationship is​

Quizplus · Accepted Answer

Roberta's introduction of Steve as "my associate" to her friends could lead them to reasonably believe that Steve has the authority to act on her behalf, making her liable for his actions under the principle of agency by estoppel. This occurs when a principal's behavior causes a third party to believe that an agent has authority, even if no formal agreement exists.

Roberta Introduces Steve to Her Friends as "My Associate