Question 1

An agent may use the agency relationship to obtain property for himself or herself when the principal desired to obtain the same property.

Accepted Answer

An agent has a fiduciary duty to act in the best interest of the principal and cannot use their position to secure property for themselves, especially if it interferes with the principal's interests. This would be a breach of their obligation and could result in legal action being taken against them.

Question 2

The principal can sue the agent,and may be entitled to a variety of contract and tort remedies beyond those stated in the contract,if an agent breaches his or her duties.

Accepted Answer

The principal can sue the agent for breach of duties and may be entitled to additional contract and tort remedies beyond what is stated in the contract.

Question 3

In Ralph T.Leonard v.Jerry D.McMorris,the text case that discussed whether,under the Colorado Wage Claim Act,company executives of a bankrupt company were liable to employees for unpaid wages and benefits,which of the following was the result?

Accepted Answer

A)According to the court,"[T]he officers and agents of a corporation are not jointly
and severally liable for payment of employee wages and other compensation the corporation owes to its employees under the employment contract and the Colorado Wage Claim Act." Although there is a duty to compensate for the corporation,the executives who were the defendants were not individually liable to the former employees for the unpaid wages.
B)According to the court,"[T]he officers and agents of a corporation are not jointly and severally liable for payment of employee wages and other compensation the corporation owes to its employees under the employment contract and the Colorado Wage Claim Act." Although there is a duty to compensate for the corporation,the executives who were the defendants were not individually liable to the former employees for the unpaid wages.
C)According to the court,"[T]he officers and agents of a corporation are not jointly and severally liable for payment of employee wages and other compensation the corporation owes to its employees under the employment contract and the Colorado Wage Claim Act." Although there is a duty to compensate for the corporation,the executives who were the defendants were not individually liable to the former employees for the unpaid wages.
D)According to the court,"[T]he officers and agents of a corporation are not jointly and severally liable for payment of employee wages and other compensation the corporation owes to its employees under the employment contract and the Colorado Wage Claim Act." Although there is a duty to compensate for the corporation,the executives who were the defendants were not individually liable to the former employees for the unpaid wages.
E)According to the court,"[T]he officers and agents of a corporation are not jointly and severally liable for payment of employee wages and other compensation the corporation owes to its employees under the employment contract and the Colorado Wage Claim Act." Although there is a duty to compensate for the corporation,the executives who were the defendants were not individually liable to the former employees for the unpaid wages.

Question 4

When parties form an agency relationship by making a written or oral agreement,the agency is known as a[n] ________.

Accepted Answer

A)When parties form an agency relationship by making a written or oral agreement,
the agency is known as an expressed agency,or agency by agreement.
B)When parties form an agency relationship by making a written or oral agreement,the agency is known as an expressed agency,or agency by agreement.
C)When parties form an agency relationship by making a written or oral agreement,the agency is known as an expressed agency,or agency by agreement.
D)When parties form an agency relationship by making a written or oral agreement,the agency is known as an expressed agency,or agency by agreement.
E)When parties form an agency relationship by making a written or oral agreement,the agency is known as an expressed agency,or agency by agreement.

Question 5

In Ackerman v.Sobol Family Partnership,LLP,the text case that discussed whether the plaintiffs were bound by representations of their attorney regarding settlement that they had not approved,which of the following was the result?

Accepted Answer

A)The court found that the plaintiffs' attorney had apparent authority from his clients,that the defendants' counsel reasonably believed that plaintiffs' counsel was authorized by the plaintiffs to make the settlement offer at issue,and that defendants' counsel acted in good faith.
B)The court found that the plaintiffs' attorney had apparent authority from his clients,that the defendants' counsel reasonably believed that plaintiffs' counsel was authorized by the plaintiffs to make the settlement offer at issue,and that defendants' counsel acted in good faith.
C)The court found that the plaintiffs' attorney had apparent authority from his clients,that the defendants' counsel reasonably believed that plaintiffs' counsel was authorized by the plaintiffs to make the settlement offer at issue,and that defendants' counsel acted in good faith.
D)The court found that the plaintiffs' attorney had apparent authority from his clients,that the defendants' counsel reasonably believed that plaintiffs' counsel was authorized by the plaintiffs to make the settlement offer at issue,and that defendants' counsel acted in good faith.
E)The court found that the plaintiffs' attorney had apparent authority from his clients,that the defendants' counsel reasonably believed that plaintiffs' counsel was authorized by the plaintiffs to make the settlement offer at issue,and that defendants' counsel acted in good faith.

Question 6

Which of the following is true regarding the form of authority upon which an agency relationship may be created?

Accepted Answer

A)Agency relationships can be created on the basis of any of the following four forms of authority:
1.By expressed agency or agency by agreement.
2.By implied authority.
3.By apparent agency or agency by estoppel.
4.By ratification.
B)Agency relationships can be created on the basis of any of the following four forms of authority:
1.By expressed agency or agency by agreement.
2.By implied authority.
3.By apparent agency or agency by estoppel.
4.By ratification.
C)Agency relationships can be created on the basis of any of the following four forms of authority:
1.By expressed agency or agency by agreement.
2.By implied authority.
3.By apparent agency or agency by estoppel.
4.By ratification.
D)Agency relationships can be created on the basis of any of the following four forms of authority:
1.By expressed agency or agency by agreement.
2.By implied authority.
3.By apparent agency or agency by estoppel.
4.By ratification.
E)Agency relationships can be created on the basis of any of the following four forms of authority:

Question 7

Agents in Australia are obligated to act personally on behalf of the principal.

Accepted Answer

According to the Australian law of agency, agents are required to act personally on behalf of the principal, fulfilling their duties to the best of their abilities while maintaining their fiduciary responsibilities towards the principal. This means that they cannot delegate their responsibilities to a third party without the express consent of the principal.

Question 8

Not only must a principal agree to have a person act as an agent,but the agent must also agree to act for the principal.

Accepted Answer

Both parties (principal and agent) must give their consent to enter into an agency relationship. This means that not only the principal must agree to have the agent represent them, but also the agent must agree to act on behalf of the principal.

Question 9

A person who has a duty to act primarily for another person's benefit is called a[n] ________.

Accepted Answer

A)A fiduciary is a person who has a duty to act primarily for another person's
benefit.
B)A fiduciary is a person who has a duty to act primarily for another person's benefit.
C)A fiduciary is a person who has a duty to act primarily for another person's benefit.
D)A fiduciary is a person who has a duty to act primarily for another person's benefit.
E)A fiduciary is a person who has a duty to act primarily for another person's benefit.

Question 10

An individual who lacks contractual capacity may hire an agent to make contracts on his or her behalf.

Accepted Answer

The answer of An individual who lacks contractual capacity may...

Question 11

All employees are agents of their employers,and all agents are employees.

Accepted Answer

This statement is false. While some employees may also function as agents, not all agents are employees. For example, a real estate agent may not be employed by a specific company but still acts as an agent for their clients.

Question 12

An agency relationship exists when an agent is authorized to act for and on behalf of the principal,who hires an agent to represent him or her.

Accepted Answer

This is the definition of an agency relationship.

Question 13

One who acts without consideration is called a gratuitous agent.

Accepted Answer

A gratuitous agent is one who acts without receiving any consideration or compensation for their actions.

Question 14

An expressed agency is the most common type of agency but it does not give the agent the authority to contract on behalf of the principal.

Accepted Answer

An expressed agency does give the agent the authority to contract on behalf of the principal.

Question 15

Agency law is primarily federal law.

Accepted Answer

Agency law is primarily governed by state law, although there are some federal laws that may apply, such as the Civil Rights Act and the Fair Labor Standards Act.

Question 16

Agents may have contract remedies available against a principal,but not tort remedies.

Accepted Answer

Agents can have both contract and tort remedies against a principal, depending on the nature of the principal's breach or misconduct.

Question 17

A principal may not enact a power of attorney after becoming incompetent.

Accepted Answer

A principal must have the capacity (competency) to execute a power of attorney, and once they become incompetent, they are no longer able to do so.

Question 18

The principal does not owe duties to an agent even though an agent owes duties to a principal.

Accepted Answer

The principal owes duties to an agent, such as the duty to compensate the agent for their services and to reimburse them for expenses incurred while acting on the principal's behalf, among other duties.

Question 19

The law assumes that the principal is aware only of information actually provided to the principal by the agent.

Accepted Answer

The law often operates under the principle of "imputed knowledge," meaning that the principal is assumed to know whatever the agent knows within the scope of the agency relationship, even if the agent has not actually informed the principal.

Question 20

An agency relationship may be created only for a lawful purpose.

Accepted Answer

According to the law of agency, an agency relationship must be created for a lawful purpose. Any purpose that is illegal or against public policy cannot be the basis for an agency relationship.

Quiz 33: Agency Formation and Duties