Source: http://agency.uslegal.com/rights-duties-and-liabilities-between-principal-and-agent/
Timestamp: 2016-02-12 01:12:36
Document Index: 565900918

Matched Legal Cases: ['§ 8', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8']

Rights, Duties, and Liabilities Between Principal and Agent - Agency
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Rights, Duties, and Liabilities Between Principal and Agent
An agency is the creation of a contract entered into by mutual consent between a principal and an agent. By agency, a principal grants authority to an agent to act on behalf of and under the control of the principal. The relation between a principal and an agent is fiduciary and an agent’s actions bind the principal[i]. The law of agency thus governs the legal relationship in which an agent deals with a third party for his/her principal.
the terms of the agreement between the parties[ii]; and
extent of the authority conferred and the obligations of loyalty to the interests of the principal.
avoid conflict between his/her personal interests
not to acquire any material benefit from a third party in connection with transactions conducted or through the use of his/her positions as an agent[iii];
to act with the care, competence, and diligence normally exercised by agents in similar circumstances[iv];
to take action only within the scope of the his/her actual authority[v];
to comply with all lawful instructions received from the principal and persons designated by the principal concerning agent’s actions on behalf of the principal[vi];
to act reasonably and to refrain from conduct that is likely to damage the principal’s enterprise[vii];
An agent is liable to a principal when he/she acts without actual authority, but with apparent authority. An agent is liable to indemnify a principal for loss or damage resulting from his/her act.
To indemnify and protect the agent against claims, liabilities, and expenses incurred in discharging the duties assigned by the principal[viii].
Because of the fiduciary relationship, a principal owes his/her agent a duty of good faith and fair dealing[ix]. However, a principal can be relieved of contractual obligations by an agent’s prior breach of contract.
A principal has a duty to act in accordance with the express and implied terms of any contract between a principal and an agent[x].
[i] Andrews v. Schram, 562 N.W.2d 50 (Neb. 1997)
[ii] E. S. Harper Co. v. General Ins. Co., 91 Idaho 767, 771 (Idaho 1967); Garl v. Mihuta, 50 Ohio App. 2d 142 (Ohio Ct. App., Lorain County 1975)
[iii] Restat 3d of Agency, § 8.02
[iv] Restat 3d of Agency, § 8.08
[v] Restat 3d of Agency, § 8..09
[vi] Restat 3d of Agency, § 8.09
[vii] Restat 3d of Agency, § 8.10
[viii] Western Smelting & Refining Co. v. First Nat’l Bank, 35 N.W.2d 116 (Neb. 1948)
[ix] Lawrence Warehouse Co. v. Twohig, 224 F.2d 493 (8th Cir. Iowa 1955)
[x] Restat 3d of Agency, § 8.13