Where one individual (a principal ) expressly or impliedly uses the services of another (an agent) to
carry out a specific task on his or her behalf
An agent has Express authority to enter into a contract with the third party on the principal’s behalf.
Therefore an agent can effect a contract with a third party for the principal and his job is to effect
contracts with third parties for his employer.
An agent can have Ostensible or Apparent Authority when the principal holds the agent out as
having the authority to act on the principal’s behalf making the third party believe that the
agent/employee has the authority to effect a contract with the third party.
An agency by Estoppel may arise when an agency relationship is inferred from the actions of a
principal, or actions that convey the impression to another that he has conferred authority on a
particular person as an agent. Always accompanies an argument of a contract being formed between
teh principal and the third party where the agent has apparent or ostensible authority
Agency by ratification can occur If the principal likes a contract that an unauthorized agent created,
the principal can ratify it and the contract will become binding between TP and P
To determine if there is a contract between the principal and TP:
1. Did the agent have express authority