MCS 3040 Lecture Notes - Lecture 10: Limited Liability Partnership, Sole Proprietorship, Apparent Authority

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 3040
• Professor: Joseph Radocchia

Document Summary

Actual authority: agent is explicitly told what they can do. He ends up signing a contract even though the 3rd party knows that his actual authority doesn"t permit him to do so. The principal isn"t bound to the contract because the 3rd party knew his authority. But the contract still exists, and joe is liable for it. Monday, november 21, 2016 ex. principal hires joe to get 3 quotes. He ends up signing a contract with 3rd party. On the assumption of apparent/implied authority, the principal is bound by the contract, because it was reasonable for the 3rd party to assume that. Because of apparent authority, garrod was stuck to that obligation. If principal didn"t take steps to stop them, they may be stuck with that agents representations. Types of business organizations: sole proprietorship, partnership, corporation. Monday, november 21, 2016: simples, easiest, least expensive way to start a business.