LAW 603 Study Guide - Final Guide: Intangible Property, Apparent Authority, Corporate Law
18 Apr 2013
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An agent is a person who acts on behalf of someone else for some specific purpose. A principal is a person whom an agent represents for some specific purpose. An agency is the legal relationship between a principal and an agent. Explain how an agency relationship can be created. Distinguish between the actual authority of agents to enter into contracts on behalf of their principals and their apparent authority to do so. Actual authority: exists when the principal actually authorizes the agent to act on its behalf. Can exist through oral delegation of authority. Agency relationship exists when a principal represents someone as its agent in discussions with a third party. Apparent authority: when the principal creates the reasonable impression that the agent is authorized to act on the principal"s behalf. A contract created by an agent within its apparent authority is just as enforceable as if the agent had actual authority.
