Question 1

Miklos grants an ordinary power of attorney to Nathalie to handle a list of financial transactions on Miklos's behalf.This power will terminate on

Accepted Answer

The power of attorney will terminate upon Miklos's death or incapacity, which is the usual and standard condition for termination of a power of attorney. The other options are not valid as they are not typical for termination conditions of a power of attorney, and A is ambiguous since it does not stipulate what constitutes a loss to Miklos.

Question 2

BizOnline.com uses an electronic agent,or e-agent,to perform certain tasks in e-commerce.With respect to the e-agent's actions,BizOnline.com is bound by

Accepted Answer

BizOnline.com is bound by all of the actions of its e-agent because the e-agent acts on behalf of the company, and its actions are considered as actions of the company itself in the context of e-commerce.

Question 3

Rupert,an agent for Star Productions,Inc.,enters into an unauthorized contract with Theatrical Transport Corporation purportedly on behalf of Star,which refuses to perform.Rupert is liable

Accepted Answer

Rupert is liable for misrepresentation to Theatrical Transport because he acted without authority, leading them to believe he had the power to bind Star Productions, Inc.

Question 4

Cory employs Daily Delivery Agency as an agent under a writ?ten agreement that describes the rights and duties of both parties.This is

Accepted Answer

The written agreement between Cory and Daily Delivery Agency explicitly states the rights and duties of both parties, indicating that Cory has given express authority to Daily Delivery Agency as an agent. Apparent authority refers to a situation where a principal gives the appearance of authority to an agent, even if it is not explicitly granted. Equal authority and implied authority are not relevant in this context.

Question 5

Trey,an agent for Uno Music Corporation,executes an unau?thor?ized contract with Variety Recording,Inc.,that is highly ad?vanta?geous to Uno.Variety withdraws from the deal before Uno ratifies the con?tract.The contract is

Accepted Answer

An unauthorized contract is void because it was never legally binding in the first place.

Question 6

Based on Nan's conduct,Odel reasonably believes that Poppy has the authority to act on Nan's behalf even though Poppy does not have the actual authority to do so.In this circumstance,Poppy has

Accepted Answer

Apparent authority occurs when a principal, such as Nan, creates the appearance that a third party, such as Poppy, has the authority to act on their behalf. In this scenario, Odel reasonably believes that Poppy has the authority to act on Nan's behalf because of her conduct. Therefore, Poppy has apparent authority, even though she doesn't have actual authority.

Question 7

Elin,an agent for First Credit Corporation (FC),enters into an unau?thorized contract with Great Expectations,Inc.(GE),purportedly on FC's behalf.This contract will be enforceable if it is ratified by

Accepted Answer

As Elin acted without authority, the contract is voidable by FC. However, if FC chooses to ratify the contract, it becomes binding on both parties. Therefore, the contract will only be enforceable if it is ratified by FC.

Question 8

Jaclyn,an agent for Kilpatrick,enters into a contract on Kilpatrick's behalf with Leif that must be in writing to be enforceable under the Statute of Frauds.Under the equal dignity rule,Jaclyn's authority to enter into this contract

Accepted Answer

The equal dignity rule requires that if a contract must be in writing to be enforceable under the Statute of Frauds, then the agent's authority to enter into that contract must also be in writing. Therefore, Jaclyn's authority to enter into the contract with Leif must also be in writing to be enforceable.

Question 9

Security Armored Car Corporation employs Theo as an agent.Without Security's knowledge but otherwise acting within the scope of em?ployment,Theo commits a crime.The state can successfully prosecute

Accepted Answer

Theo committed the crime without Security's knowledge and within the scope of his employment, which means that Security cannot be held responsible for his actions. Therefore, the state can successfully prosecute Theo only.

Question 10

Sonia manages a Tasty Pastry store for United Food Company.To manage the business,Sonia's authority can be implied by

Accepted Answer

Sonia's authority can be implied by the position she occupies as a manager of a Tasty Pastry store for United Food Company. As a manager, she is expected to have the authority to make decisions and take actions that are necessary to run the business. This authority is implied by her position in the company.

Question 11

Fabulous Auto Sales,Inc.,employs GR8 Collection Company as a collection agent.While repossessing a car from Hadji,one of Fabulous's customers,GR8 causes an accident in which Hadji is injured.Hadji can recover from

Accepted Answer

Both Fabulous and GR8 could be held liable for the actions of their agent, GR8. Hadji could potentially recover damages from either or both of them in a lawsuit.

Question 12

Omar hires Petra,a real estate broker,to act as his agent to sell his land for $150,000.Oil is discovered beneath the land,causing its market value to in?crease considerably.The agency agreement is likely

Accepted Answer

The agency agreement is terminated by operation of law, as the discovery of oil changes the terms of the agreement and renders it impossible to perform. The increased market value of the land makes it a fundamentally different property than the one initially listed, and thus the terms of the original agreement no longer apply. This termination occurs automatically, without the need for mutual consent or additional consideration.

Question 13

Fact Pattern 33-1A (Questions A10-A11 apply)
Ulani indicates that she is acting as an agent on behalf of an unidentified client-Thoroughbred Stallions,LLC-when she enters into a contract with Shana.
-Refer to Fact Pattern 33-1A.Thoroughbred Stallions is

Accepted Answer

Thoroughbred Stallions, LLC is a partially disclosed principal because Ulani indicated she was acting on behalf of a client, but did not reveal the identity of the client to Shana.

Question 14

Emery is an agent for Downtown Market Corporation.Emery makes an innocent mis?representation when entering into a contract on be?half of Downtown Market with Cool Fruits,Inc.Cool Fruits

Accepted Answer

Since Emery made an innocent misrepresentation, Cool Fruits may rescind the contract if they choose to do so. They are not bound by the terms of the contract if they can prove that Emery's misrepresentation was a material fact that induced them to enter into the contract. Cool Fruits is not directly responsible for performing the contract, nor are they estopped from performing the contract. They may choose to ratify the contract, but this would not be required.

Question 15

Fact Pattern 33-1A (Questions A10-A11 apply)
Ulani indicates that she is acting as an agent on behalf of an unidentified client-Thoroughbred Stallions,LLC-when she enters into a contract with Shana.
-Refer to Fact Pattern 33-1A.Liability to Shana for nonper?formance of the con?tract may be imposed on

Accepted Answer

Ulani acted as the agent for Thoroughbred Stallions and entered into a contract with Shana on their behalf. Therefore, both Ulani and Thoroughbred Stallions may be held liable for nonperformance of the contract.

Question 16

Meals n' More,Inc.,a catering company,requires its customers to pay by check.Lyra,a Meals n' More driver,tells customers that they can pay her with cash.When Meals n' More learns of Lyra's collections,it takes no action to stop it.Lyra steals some of the cash.Meals n' More may suffer the loss under the doc?trine of

Accepted Answer

Apparent authority is when an agent (Lyra), who does not have actual authority to act on behalf of a principal (Meals n' More), behaves in a way that suggests to third parties (customers) that they have the authority to act on behalf of the principal. In this case, Lyra is acting outside the scope of her actual authority by accepting cash payments, but Meals n' More's failure to take action to stop her creates the appearance of authority to customers. Therefore, under the doctrine of apparent authority, Meals n' More may be held responsible for Lyra's actions and any losses incurred as a result.

Question 17

Clive is a purchasing agent for Double D Ranch with the authority to buy cat?tle at a certain auction.After the cattle are bought,the agency rela?tionship terminates

Accepted Answer

According to the given information, the agency relationship terminates automatically after the cattle are bought.

Question 18

Commercial Development Corporation (CDC)hires Delta Construction Company to work at a site as an independent contractor.Whether CDC will be liable for torts committed at the site by Delta depends on

Accepted Answer

CDC could potentially be liable for torts committed by Delta if the activity being performed is considered unusually hazardous. This is because the principle of strict liability applies to owners of land where such activities are taking place, regardless of whether they are being performed by an independent contractor. Factors that may be considered in determining whether an activity is unusually hazardous include the degree of risk involved, the likelihood of harm, and the feasibility of taking precautions to minimize the risk. The other options, such as Delta's bid, insurance coverage, or payment arrangements, are not relevant to the question of CDC's liability for torts committed by Delta.

Question 19

Homer is an officer of Integrity Corporation.With respect to binding Integrity to contracts,Homer's authority

Accepted Answer

Homer's authority to bind Integrity Corporation to contracts can be either actual, meaning he has been given explicit authorization by the company to enter into contracts, or apparent, meaning he has the appearance of being authorized by the company to enter into contracts.

Question 20

Frida hires Gert,a real estate broker,to act as her agent to sell her house.The house burns down before being sold.The agency agreement is likely

Accepted Answer

The agency agreement is terminated by operation of law, as the object of the agreement (the house) no longer exists.

Quiz 33: Agency Liability and Termination