Gagnon V. Coombs

Gagnon v. Coombs

The case of Gagnon v. Coombs deals with the agency relationship.

Agency is the fiduciary relationship that arises when one person (principal) manifests assent to another person (an agent) that the agent shall act on the principal’s behalf and subject to the principal’s control, and the agent manifests assent or otherwise consents so to act (Beatty, Samuelson, & Bredeson, 2008).

Francis Gagnon and Joan Coombs entered into an agency relationship when he signed a power of attorney appointing Mrs. Coombs as his agent.

Mr. Gagnon did revoke the power of attorney however; he did not explicitly tell Joan that he revoked it at that time. However; Mr. Gagnon told Mrs. Coombs about him signing a purchase and sale agreement and his intentions on selling the property. When Mrs. Coombs learned of Mr. Gagnon’s purchase and sale agreement, she should have realized that her authority had been revoked by this action. Joan did not have the right to convey the Shelburne farm to a trust she had established due to the fact that Mr. Gagnon had revoked Mrs. Coombs’ authority. Due to the fact that Mrs. Coombs did not have the right to put the property in a trust, the property belongs to Mr. Gagnon.

Even if Mrs. Coombs power had not been revoked she did not put Mr. Gagnon’s interests first which was her fiduciary duty. Mrs. Coombs had “a fiduciary duty to act loyally for the principal’s benefit in all matters connected with the agency relationship” (Beatty, Samuelson, & Bredeson, 2008). When Mrs. Coombs learned of Mr. Gagnon’s intention to sale the property her action of putting the property in a trust was not acting in Mr. Gagnon’s interest and did not uphold her fiduciary duty to Mr. Gagnon.

References

Beatty, J. F., Samuelson, S. S., & Bredeson, D. A. (2008). Introduction to Business Law (4th ed.). Mason, OH: South-Western.