When the parties do not agree on the duration of the agency and the agent has incurred substantial expenses in completing the agency, a court will likely hold that:
A) the agency relationship must be terminated immediately to avoid unjust enrichment.
B) the principal cannot terminate the agency until after the agent has had a reasonable time to try to earn the expected commission.
C) only the principal can terminate the agency and the courts cannot hold the agent liable for any expenses incurred by the agent during the agency period.
D) the principal will be required to indemnify the agent if some fault of the agent causes a loss.

Question

Quizplus · Accepted Answer

Sometimes an agent is expected to incur substantial expenses that are to be recouped through a commission on completion of the agency. When no duration is agreed on and the agent has made the expenditures, a court may hold that the principal cannot terminate the agency until after the agent has had a reasonable time to try to earn the expected commission.

When the Parties Do Not Agree on the Duration of the Agency