Lesson+8-Agency+and+Employment

Lesson 8 - Agency and Employment

Presentations for this Lesson (Having issues uploading files, see Mrs. Cuellar's 'PickUp' folder for copies of the presenations.)

Terms for this Lesson ** Chapter 25 Vocabulary ** 1. **Agency**- When one person is authorized to alter another’s legal relationships, the relationship of //__agency__// exists. 2. **Principle**- The person who authorizes another to alter one of his or her legal relationships (the business owner) is a //__principle__//. 3. **Agent**-The party authorized by the principle to act on his or her behalf (the sales person) is the //__agent__//. 4. **Third party**- The agent represents the principle in reaching agreements that bind the principle and a //__third party__// (customers). 5. **Scope of Authority**- The //__scope of authority__// is the range of acts authorized by the principle. 6. **Fiduciary Duties**- Requires that the agent serve the best interests of the principle. 7. **Warranty of the Principle’s Capacity**- imposed by law on the agent. 8. **Gratuitous Agency**- In cases where the agent receives no consideration, and there is no contract. 9. **Express Authority**- directly communicated by the principle to the agent, maybe be verbal or written. 10. **Power of attorney**- Any writing that appoints someone as an agent is called a //__power of attorney__//. 11. **Implied authority**- is the power to do anything that is reasonably necessary or customary to carry out the duties expressly authorized. 12. **Ratification**- This approval of a previously unauthorized act, or an act outside the agent’s scope authority, is called //__ratification__//. 13. **Apparent authority**- is created when a principle leads the third party to reasonably believe that a particular person has agency authority. ** Chapter 26 Vocabulary ** 1. **Fiduciary duties**- owed by agents to principals are loyalty, care, and skill, confidentiality, and accounting. 2. **Duty of loyalty and obedience**- It requires that agents place the interests of their principals above the interests of all others. 3. **Duty of reasonable care and skill**- This requires the agent to exercise the degree of care and skill that a reasonably prudent person would using a similar situation. 4. **Duty of confidentiality**- requires the agent to treat information about the principal with great caution. 5. **Duty of accounting**- requires an agent to account to the principal for all money and property of the principal that comes into the agent’s possession. 6. **Commingling**- is mixing the funds or property of the principal and agent. 7. **Trust accounts**- Money that is put into a separate account, other than the agent’s bank account. Funds for the principle go in here. 8. **Undisclosed principal**- When the agent is not allowed to disclose the principal’s existence or identity.