Opinion ID: 2627706
Heading Depth: 2
Heading Rank: 1

Heading: This Court previously extended the doctrine of apparent agency to tort claims in Bailey v. Ness, 109 Idaho 495, 708 P.2d 900 (1985).

Text: First, Appellants argue that the district court erred in determining that Idaho does not recognize the doctrine of apparent agency as a basis of liability for tort claims. In support of their argument, Appellants direct this Court's attention to Bailey v. Ness, 109 Idaho 495, 708 P.2d 900 (1985). In Bailey, this Court said: There are three types of agency, any of which are sufficient to bind the principal to a contract entered into by an agent with a third party, and make the principal responsible for the agent's tortious acts, so long as the agent has acted within the course and scope of authority delegated by the principal. The three types of agency are: express authority, implied authority, and apparent authority. 109 Idaho at 497, 708 P.2d at 902 (emphasis added). The district court determined that this language was merely dicta since Bailey was a breach of contract matter. As such, the district court relied on Landvik v. Herbert, 130 Idaho 54, 936 P.2d 697 (Ct.App. 1997), in which the Court of Appeals held that no appellate court in Idaho had ever applied the doctrine of apparent authority to create tort liability on the part of the principal. Landvik, 130 Idaho at 59, 936 P.2d at 702. Based in part on this holding, the district court denied Appellants' motion for partial summary judgment on the issue of apparent agency and subsequently awarded summary judgment in favor of TVH. In order to determine whether the district court erred, we find it necessary to review our decision in Bailey. In that case, the buyer of a feed mill system brought breach of contract and defective construction and design claims against Stan Ness, d/b/a Feed-Rite Systems, Inc., seeking to hold Ness liable for $37,000.00 in damages to the system. Comp. & Demand for Jury Trial; Amended Compl. & Demand for Jury Trial. [3] The buyer also filed suit against Mix-Mill, Inc., a manufacturer of feed mill systems, claiming, among other things, that Mix-Mill was vicariously liable for Ness's negligence in designing the defective feed system under the doctrine of apparent authority. Id. The district court granted summary judgment in favor of Mix-Mill on the issue of apparent authority, and we reversed, holding that there was a factual dispute as to whether Ness had apparent authority from Mix-Mill to assist in designing the buyer's feed system. Bailey, 109 Idaho at 498, 708 P.2d at 903. Thus, we not only recognized that tort liability could be imposed under the doctrine of apparent authority, but actually extended the doctrine of apparent authority to a tort claim in that case. As such, Bailey holds that a principal can be held liable for an agent's tortious acts under Idaho's doctrine of apparent authority. TVH argues that Bailey is inapplicable because it dealt with apparent authority rather than apparent agency. Specifically, TVH argues that apparent authority presupposes an existing agency relationship, whereas apparent agency does not. However, there was no preexisting agency relationship in Bailey. It was undisputed in that case that Ness was not an actual agent of Mix-Mill. Bailey, 109 Idaho at 497, 708 P.2d at 902. Furthermore, comment (a) to section 2.03 of the Restatement (Third) of Agency sets forth that apparent authority does not presuppose the present or prior existence of an agency relationship, but rather the doctrine can be applied to actors who appear to be agents but who actually are not. Restatement (Third) of Agency § 2.03, comment (a) (2006). Comment (b) to that section also explains that many jurisdictions use the terms apparent authority and apparent agency interchangeably. Id. at § 2.03, comment (b). Thus, our holding in Bailey applies to tort claims brought under the doctrine of apparent agency as well. Therefore, we agree with Appellants that the doctrine of apparent agency extends to tort claims in Idaho.