Question 1

Identify and briefly describe how an employed clerk typist may be transformed into the business's agent.

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Question 2

Briefly describe the types of duties owed by an agent to his principal and indicate which of those duties would be considered to be the most important. Contrast the agent's duties with those owed to the agent by his principal.

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Question 3

Identify each type of agency authority and describe what is required of the principal in each instance.

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Question 4

Identify the circumstances under which a principal would be permitted, by law, to ratify a contract.

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Question 5

Identify how a fiduciary duty arises, who is it owed to, and any requirements with regard to specifically state the duty. Provide a brief explanation of what the fiduciary duty is with regard to conflict of interest and how that obligation may be overcome. Provide an example of a conflict of interest situation.

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Question 6

A principal whose identity is unknown to a third party who has no knowledge that the agent is acting in an agency capacity is legally known as an undisclosed principal.

Accepted Answer

This is the definition of an undisclosed principal in agency law.

Question 7

Identify and briefly describe the implied power a general manager of a hockey team presumably would have. Contrast the hockey team general manager's implied power with that presumably given to a manager of a convenience store.

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Question 8

Identify and briefly describe the ways in which the nature of the authority given to an agent is inherently flexible and easily customized.

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Question 9

Explain why agency by estoppel forces a principal to be bound by an unauthorized contract. Contrast and briefly discuss this with respect to a principal's position under agency by ratification.

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Question 10

A representation of authority given by a person who purports to be an agent is legally known as a disclosed warranty.

Accepted Answer

A representation of authority given by a person who purports to be an agent is legally known as an implied warranty of authority, not a disclosed warranty.

Question 11

Identify and briefly describe the typical forms of power of attorney. Provide an example of each form of power of attorney you have identified.

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Question 12

An agent automatically owes a fiduciary duty to his principal.

Accepted Answer

An agent- principal relationship is built on trust and requires the agent to act in the best interest of his principal, which is called a fiduciary duty. By default, the agent owes this duty to his principal without any express agreement to that effect.

Question 13

An agent is bound by a fiduciary duty to avoid undisclosed, unauthorized conflicts of interest.

Accepted Answer

As a fiduciary, an agent must act solely in the best interest of their principal and avoid any conflicts that could compromise their duty of loyalty. This includes disclosing any conflicts of interest and obtaining authorization from the principal before engaging in any transactions that could create a conflict.

Question 14

Briefly discuss the importance of the agency relationship to business, including what it is, what it allows, how it is used, and the advantage derived from using it.

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Quiz 13: The Agency Relationship