To avoid being bound by the acts of the agent after the agency has ended, the principal:
A) should give actual notice to those who have dealt with the former agent.
B) need not give notice as he has no liability.
C) should give verbal notice if the termination is due to loss of legal capacity by the principal.
D) should get the agent to give notice.

Question

Quizplus · Accepted Answer

An agent still may be able to bind the principal on contracts with third persons after termination of the agency if the third person is unaware that the agency has ended. This is because an agency continues in existence as to a third person until that person has notice or knowledge of its termination. To avoid being bound by acts of the agent after termination, the principal must give actual notice to those who have dealt with the former agent.

To Avoid Being Bound by the Acts of the Agent