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Jennifer Hakala - Principle Agent Relationship - Final - Mind Map
Jennifer Hakala - Principle Agent Relationship - Final
- Principle-Agent Relationship
- Agency Relationships
- Agent & Principal
- Agent represents or acts on behalf of Principal
- Principal agrees agent will act on their behalf
- Fiduciary Relationship
- Relationship involves trust and confidence
- Principal has right to direct agent
- Employee vs contractor relationships
- Employee
- Agent to 3rd party for businesses
- State and Federal employment laws apply
- Employer has control of how and when job is done
- Contractor
- Not an employee
- Contractor controls how and when job is done
- May or may not be an agent
- How Agency relationships are formed
- Agency by Agreement - Express written contract or oral agreement
- Agency by Ratification - Agent unofficially establishes contract for principal-who affirms the contract themselves
- Agency by Estoppel - Principal falsely implies agency Third party follows implication
- Agency by Operation of Law - Spousal liability and Agency to authorize medical care
- Agent’s Duties to the Principal
- Performance - Use diligence and skill in performed work
- Notification - Agent must notify principal on all matters regarding agency
- Loyalty - Agent must act solely for principal benefit
- Obedience - Agency must obey instruction given by principal
- Accounting - Agent must keep an accounting available to principal
- Principal’s duties to the Agent
- Compensation - Payment due for services unless provided gratuitously
- Reimbursement and Indemnification - Reimbursement for expenses incurred by principal for agency liabilities
- Cooperation - Principal must assist agent in duties required
- Safe Working Conditions - Equipment premises and conditions must be safe for principal
- Type of Agent Authority
- Express Authority - Authority declared in clear, direct, and definite terms either orally or in writing
- Ratification - Principal affirms agents actions retroactively following the six requirements
- Agent must have acted on behalf of identified principal who ratifies retroactively
- Principal must know all material facts - If material facts unknown principal may rescind
- Principal must affirm the agent's action in full
- Principal and third party must have legal capacity at time of engagement and ratification
- Principals affirmation must happen prior to third-party withdrawal
- Principal must authorize is same manor that would have initially been required
- Implied Authority - Agent acts with reasonable care to accomplish agency objectives
- Apparent Authority - Principal causes third-party to believe agent has their authority to act although no express or implied authority exists
- Termination of Agency
- Termination by Act of the Parties - Acts include lapse of time, achievement of purpose, occurrence of an specified event, mutual agreement, and action by one party
- Wrongful Termination - Power does not mean right to termination agency
- Agency Coupled with an Interest - When agent has legal rights to property in agency the agent may not be terminated until their interest ends
- Notice of Termination - If written permission then written termination otherwise no particular form is required and principal must inform third-persons directly
- Termination by Operation of Law - No duty to notify third-persons
- Death or Insanity
- Impossibility
- Changed Circumstances
- Bankruptcy
- War
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