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Date Submitted: 11/03/2014 10:12 PM
Unit 3
Chapter 28 – agency law
* Creating an agency relationship
* Consent – to establish consent, the principal must ask the agent to do something and the agent must agree
* Control
* Principals are liable for the acts of their agents BC they exercise control over the agents
* An agent and principal must not only consent to an agency relationship, but the principal must also have control over the agent
* Fiduciary relationship
* A special relationship with high standards
* Beneficiary places special confidence in the fiduciary who, in turn, is obligated to act in good faith and candor, putting his own needs second
* Agents have a fiduciary duty to their principals
* Elements not required for an agency relationship
* An written agreement
* Equal dignities rule – if an agent is empowered to enter into a contract that must be in writing, then the appointment of the agent must also be written
* A formal agreement
* Compensation
* Duties of agents to principals
* Duty of loyalty – the agent must solely act for the benefit of the principal in all matters connected with the agency
* Outside benefits – an agent may not receive profits unless the principal knows and approves
* Confidential information
* Agents can neither disclose nor use for their own benefit an confidential information they acquire during their agency
* This duty continues even after the agency relationship ends
* Competition with the principal
* Agents are not allowed to compete with their principal in any matter within the scope of agency business
* Conflict of interest between two principals
* Unless otherwise agreed, an agent may not act for two principals whose interest conflict
* Secretly dealing with the principal
* If a principal hires an agent to...