Chapter 30

  1. Agents Duty of Loyalty to the Principal (Breaches)
    • 1.) Self Dealing
    • 2.) Usurping and Opportunity
    • 3.) Competing with Principle
    • 4.) Misuse of Confidential Info
    • 5.) Dual Agency
  2. Self Dealing
    • undisclosed self dealign
    • ex: selling property to principle secretly
  3. Usurping an Opportunity
    • take an offer made to principal
    • only can be done if principle initially rejects
  4. Competing with Principle
    • can't meet duties of Agency if is competing
    • only allowed if principle permits
  5. Misuse of Confidential Info
    can't disclose confidential information during or after the agency
  6. Dual Agency
    acts as agent for two parties in the same transactions
  7. Tort of Liability to third Party
    • principle and agent are each personally liable for their own tortious conduct principle also liable if occurs within the scope
    • 1.) Negligence
    • 2.) Intentional Tort
    • 3.) Misrepresentation
    • 4.) Contract Liability to 3rd Party
  8. Negligence
    A doctrine that says a person is liable for harm that is theforeseeable consequence of his or her actions. Acts within the scope of employment than principle is vicarious liable for agent.

    • 1.) Frolic Detour rule
    • 2.) Dual Purpose mission
    • 3.) Coming and going rule
  9. Vicarious Liability
    Liability w/o fault meaning liable because of employment contract not because personally liable
  10. Frolic Detour Rule
    if deviation from scope of employment is a minor deviation of employer (detour) the employer (principle) is liable. If deviation is major (Frolic) than employer is not liable
  11. Coming and going rule
    principle not liable only agent liable if negligent act is done when coming or leaving shift
  12. Dual Purpose Mission
    when asked to use personal time to do work stuff. Principal is responsible if frolic detour rule is followed.
  13. Intentional Tort
    • acts of assault and battery false imprisonment or intentional conduct that cause injury to another person. Principle is liable under vicarious liability for intentional torts within the scope of business
    • Two test for scope:
    • 1.) Motivational Test
    • 2.) Work related test
  14. Motivational Test
    • motivation in committing tort to promote principals business principal liable but if agent motivation is personal not liable.
    • ex: bouncer off the clock liable
  15. Work Related Test
    If tort committed w/in time or space of principle reliable (motivation immaterial)
  16. Misrepresentation
    • Intentional Misrepresentation (Fraud) by agent
    • Innocent Misrepresentation (negligently) by agent

    Principle liable for intentional and innocent misrepresentation of agent third party can:

    • Rescind and sue for damages
    • Enforce and sue for damages
  17. Contract Liability to 3rd Party (determining agents liability)
    • determining liability for agent if principal fails to perform contract
    • 1.) Fully disclosed
    • 2.) Partially DIsclosed
    • 3.) Undisclosed
    • 4.) Agent Exceeds Scope
  18. Fully disclosed
    when 3rd party knows the agent is acting as a principal and the identity of principal is known

    Agent is not liable unless they guarantee that the principal will perform.
  19. Partially disclosed agency
    knows agent is an agent but not the identity of the principle

    can sue agent or principle
  20. Undisclosed Agency
    third party unaware of existence of an agency or principals identity can sue either principal or agent (donald trump)
  21. Agent Exceeds Scope of Authority
    exceeds scope of implied warranty of authority to a act as an agent. Principle not liable for contract unless they ratify it. Agent is responsible for third party for breach.
  22. Independent Contractor
    Generally principal is not liable for them unless:

    Inherent dangers activities- can't avoid strict liability inherent dangerous act like explosives, land by fire

    Negligence of selection- principle hires unqualified independent contractor.
Card Set
Chapter 30
Liability of Principals, Agents & Independent Contractors