Business Law: Agency Latest Update Graded A+

Business Law: Agency Latest Update Graded A+ Agency This is fiduciary relationship in which an agent agrees to perform a task for the principal and acts on his behalf, However, subjected to the principal's control. How is an agency relationship formed? (4) Agency by agreement " " ratification " " estoppel " " operation of law Agency by agreement Both the principal and the agent agree on certain conditions. This agreement can be formed either by an express or implied contract. Agency by ratification A person can agree to be an agent through a third party as long as the principal is then notified and approves the agreement, an agency relationship is formed. Agency by estoppel If a third party believes that another person is the principal's agent when in in fact they are not, the principal is estopped to deny the agency relationship. Agency by operation of law Sometimes in emergency situations courts will step in and deem a person to be an agent even if there was no agency agreement to prevent a party from suffering injustice. Duties of principal to agent (CRIC) To compensate the agent an agreed amount of compensation after they have completed their tasks. To Reimburse the agent of any money spent while under the principle's service. To Indemnity the agent for all losses they may have incurred in conducting the principles business. Duty to cooperate - cannot unreasonably interfere with the agent's ability to accomplish his task Duties of agent to principle (5) Loyalty & obedience -act on behalf of and be subject to the control of the principal and act within the scope of power delegated by the principal Reasonable care - discharge his or her duties with appropriate care and diligence, avoid conflict of interests with the principal Accounting - promptly hand over to the principal all monies collected on principal's behalf. Confidentiality Termination of agency (9) revocation renunciation by completion of agreed purpose expiry of time death insanity insolvency destruction of subject matter becoming enemy of the state Revocation the principle revokes the authority of the agent at any time Renunciation when the agent no longer wishes to continue working as an agent, must give notice in advance otherwise he may be liable to compensate the principle Completion agency is automatically terminated when the purpose for which the agency was created is achieved expiry of time if the agency was created for a specified time when that times come the agency comes to and end death if the principal or agent dies the agency is terminated automatically insolvency when the principle becomes... destruction when an agency is createdd with reference to a particular property or subject, if it is destroyed the agency is terminated enemy of state if the P or A is a citizen of a another country and a war breaks out it would be illegal to continue the agency