Ch 20 Relationship With 3rd Parties (got the best grade in class)

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Business Law
BLAW 3201
All Professors

Ch 20rdRelationship with 3 PartiesrdPrincipal and 3 PersonsContract Liability of PrincipalTypes of PrincipalsDisclosed Principal principal whose existence and identity are knownPartially Disclosed Principal principal whose existence is known and identity is not known An example would be an auctioneer who sells on behalf of a seller who is not identifiedUndisclosed Principal principal whose existence and identity are not knownAuthority power of an agent to change the legal status of the principalActual Authority power conferred upon the agent by actual consent given by the principalIt can be expressed or impliedWhen the principal is undisclosed an agent acting with actual authority in making the contract rdwill contractually bind the principal and the 3 party unless the terms of the contract exclude the principal from being a party or unless the agent rdfraudulently conceals the principals existence from the 3 partyActual Express Authority actual authority derived from written or spoken words of the principalActual Implied Authority actual authority inferred from words or conduct manifested to the agent by the principalEx Pearson authorizes Rob to manage her 82 unit apartment complex but says nothing about expensesIn order to manage the building Rob must employ a janitor purchase fuel for heating and arrange orderly maintenance These expenses are necessary to run the apartmentApparent Authority power conferred upon the agent by acts or conduct of the principal rdthat reasonably lead a 3 party to believe that the agent has such powerEx Arlene in the presence of Polly tells Thad that Arlene is Pollys agent to buy lumberAlthough the statement is not true Polly does not deny it as she easily couldThad in reliance upon the statement ships lumber to Polly on Arlenes orderPolly is obligated to pay for the lumber bc Arlene had apparent authority to act on Pollys behalfThis apparent authority of Arlene only exists with respect to ThadIf Arlene were to give David an order for a shipment of lumber to Polly David would be unable to hold Polly liable
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