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A principal will be liable for torts committed by its agent if:
There is a principle agent relationship and the tort was committed by the agent with the scope of that relationship.
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The principal-Agent relationship requires:
1. Assent
2. Benefit
3. Control
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Assent is an:
informal agreement between a principal with capacity, and the agent.
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Benefit means that:
the agent's conduct must be for the principal's benefit.
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Control means:
the Principal must have the right to control the agent by having the power to supervise the manner of the agent's performance.
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A principal will be vicariously liable of sub agent torts if it:
There is Assent, benefit, and control between the principal and sub-agent tortfeasor.
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A principal will be liable for a borrowed agent's tort:
only if there is assent, benefit, and control between the borrowee principal and the borrowed agent.
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In general, there is no vicarious liability between a principal and a:
independent contractor.
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A principal will only be liable for the acts of a indipendent contractor when:
1. The contractor is engaged in an inherently dangerous activity and
2. Estoppel: The principal holds out the independent contractor to the public as his agent.
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Scope of Principal-Agent relationship factors are:
1. Was conduct "of the kind agent was hired to perfom?
2. Did the tort occur on the job? (Frolic v. Detour)
3. Did the agent intend to benefit the principal?
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Frolic v. Detour
! A frolic is a new and independent journey outside of the scope of employment. (outside scope)
2. A detour is a mere departure from an assigned task (w/in scope)
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Intentional torts are generally outside/inside of the scope?
Generally outside of an agent's scope.
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An intentional tort will be within scope when:
1. Authorized by principle
2. Natural from the nature of employment or
3. Motivated by a desire to serve the principal.
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A principal is liable for Ks entered into by its agent only if:
the principal authorized the agent to enter the K.
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The four types of authority are:
1. Actual Express authority
2. Actual implied
3. Apparent
4. Ratification
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Actual express authority to enter a K occurs when:
the principal used words to express authority to agent. (even private conversations will count)
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If a K must be in writing, expressed authority must:
be in writing as well.
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Express authority can be revoked by:
1. Unilateral act of either the principal or the agent or
2. Death or incapacity of the principal before entering into the K.
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Express assent will survive death if:
the Principal gives a durable power of attorney to the agent.
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Actual implied authority gives the agent authority:
through conduct or circumstance.
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The three types of Actual Implied Authority are:
1. Necessity: Which are necessary to a accomplish an expressley authorized task.
2. Custom: Which by custom are performed by persons that the agent's title or position.
3. Prior dealings: The agent believes to be authorized from prior acquiescence by the principal.
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Apparent authority is found where:
1. The principal cloaked the agent with the appearance of authority and
2. The third party reasonably relied on appearance of authority
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Ratification is authority:
given after the K has been entered into if:
1. Principal has knowledge of all material facts and
2. Principal accepts the K's benefits.
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Ratification cannot alter:
the terms of the K.
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Generally a principle is liable for authorized contracts and:
agents are not liable for authorized Ks.
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An agent will be liable for K's entered into if:
the principal is partially disclosed or completely undisclosed.
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Agents owe their principal:
1. Duty of care.
2. Duty of obedience.
3. Duty of loyalty.
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The duty of loyalty prevents an agent from:
1. Self-dealing: Agent cannot receive a benefit to the detriment of the principal.
2. Usurping the principal's opportunity, or
3. Secret profits: Making a profit at the principal's expense without disclosure.
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Partnership formation requires no:
general partnership formalities.
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In order for there to be a partnership there must be an:
association with 2 or more persons, carrying on business as co-owners for profit.
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General partners are liable for:
all partnership obligations including the torts of their partners.
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Partnership estoppel holds parties that:
represent that there is a partnership liable as partners.
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General partners owe each other a:
duty of loyalty which prevents self-dealing, usurping and making a secret profit.
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An action for accounting allows the partnership to:
recover losses caused by a breach of the duty of loyalty and also disgorge profits made by the breaching partner as well.
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Partnership assets may not be transferred outside the partnership:
with out partnership authority.
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Management in a partnership may not:
be transferred to 3rd parties by partners individually.
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The test to determine whether a partner or partnership owns a piece of property is:
who's money was used to buy the property. The partner's or the partnership's?
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Absent an agreement each partner is entitled to equal:
control
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Partners receive no:
salary, absent an agreement.
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Partners are paid however to:
wind up the business.
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Absent an agreement, profits are shared equally and losses are shared:
like profits.
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A general partnership dissolves:
automatically upon any material change in partnership including: death or withdrawal of any general partner.
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Distribution of funds upon liquidation of a partnership are as follows:
1. Outside creditors
2. Inside creditors
3. Capital contributions
4. Profits and surpluses
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Inside outside creditors, inside creditors and capital contributions by partners must:
be paid upon liquidation of the partnership.
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Limited partners and LLC members both have:
limited liability status.
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