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Chapter 17: Management of Employee Conduct - Agency

  1. What is power of attorney?
    a form of agency relationship that grants another authority to enter into transactions
  2. What happens in an agency relationship?
    one party agrees to act on behalf of another party according to directions
  3. What are agents?
    people hired by a principal to do a task on behalf of the principal (not all agents are employees)
  4. What is a master-servant relationship?
    situation in which the principal (master) exercises a great deal of control over the agent (servant)
  5. What is an independent contractor?
    a person who is hired by another to perform a task but is not under the direct control of the hiring party (i.e., a corporations attorney)
  6. Explain express authority.
    An employee who is hired by agreement (oral or written) is an agent and has been given express authority to acton on behalf of the business.
  7. What is an express contract?
    specifies the limitations of an employee/agent's authority
  8. What is the Uniform Durable Power of Attorney Act?
    a uniform law that states that key individuals of the company (the other partner if one partner dies in a partnership) can execute a type of power of attorney that comes into existence in the event of disability or incapacity of the principal
  9. Explain apparent authority or agency by estoppel.
    an agency relationship arises not by express or implied contracts but because of the way a principal presents himself to third parties
  10. Explain ratification.
    occurs when the principal reviews a contract and voluntarily decides that, even though the agent did not have proper authority, the contract will be honored as if the agent had full authority
  11. What type of relationship do principals and agents have with each other?
    fiduciary
  12. Explain Duty of Loyalty (generally).
    An agent is required to act only for the benefit of the principal, and an agent cannot represent both parties in a transaction unless each knows about and consents to the agent's representation of the other.
  13. Explain Duty of Loyalty (Post-employment).
    Many companies have their employees sign contracts that include covenants not to compete or convenants not to disclose information about their former employers should they leave their jobs or be terminated from their employment.
  14. What happens in a gratuitous agency?
    the agent has authority to act for the principal but will not be compensated
  15. Explain The Disclosed Principal.
    A situation in which a third party is aware a principal is involved and also knows who the principal is, the principal is liable to the third party, but the agent is not, regardless of whether the agent has express, implied, or apparent authority.
  16. Explain The Partially Disclosed Principal.
    The third party knows that the agent is acting for someone else, but the identity of the principal is not disclosed.
  17. Explain The Undisclosed Principal.
    An agents acts without disclosing either the existence of a principal or the principal's identity.
  18. What happens in lingering apparent authority?
    something that exists beyond the termination of the agency in relation to third parties who are unaware of the agency termination
Author
chrisj1927
ID
83873
Card Set
Chapter 17: Management of Employee Conduct - Agency
Description
Flashcards for the MGT 340 final.
Updated

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