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Agency and Employment Law

Agency and Employment Law. Chap 21 – Agency Law Chap 22 – Employment Law Chap 23 – Unions & the Employment Relationship Chap 24 – Discrimination in Employment Chap 25 – Employment-Related Injuries. Agency Law. Chapter 21. Agency Relationship.

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Agency and Employment Law

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  1. Agency and Employment Law Chap 21 – Agency Law Chap 22 – Employment Law Chap 23 – Unions & the Employment Relationship Chap 24 – Discrimination in Employment Chap 25 – Employment-Related Injuries

  2. Agency Law Chapter 21

  3. Agency Relationship • An AGENCY is a relationship between two parties that allows one of the parties to act so as to legally bind the other • Principal: The person who authorizes another to enter into legal relationships on his or her behalf • Agent: The party that was authorized

  4. Agency Relationship • The agent is like a middle man. You want to buy something at the store. You don’t have to go to the store owner, but may go to a salesman who is an agent for the owner. • Whenever one person represents another • Either party may terminate the agency relationship at any time (there may be liability for breach of contract – but the agency can end)

  5. The Agent • The agent must act within the granted Scope of Authority:that which they have been authorized to do by the principal • When the agent works for free (no consideration) and there is no contract; the agency is called a gratuitous agency.

  6. Granting Authority • Express Authority: specific authority that is communicated directly by the principal to the agent - may be oral or written • Implied Authority: power to do anything that is reasonably necessary or customary to carry out the duties that were expressly authorized

  7. Examples • “What’s Your Verdict?” on page 388 • “In This Case” on page 389

  8. Express Authority • Power of Attorney: Any writing that appoints someone as an agent • General vs Specific P of A

  9. Agent Authority • What if the agent acts outside the scope of his or her authority? Is the principal bound? • NO! • Unless… you Ratify.

  10. For Ratification to be Valid • The third person must have believed that by dealing with the principal’s agent, he or she was making a contract with the principal. • Before ratifying the principal must have full knowledge of all material facts. • Principal must show intent to ratify. • Principal must ratify the entire act, not just part. • The principal must ratify before the third person withdraws from unratified transaction.

  11. Examples • “Think Critically About Evidence” on page 391# 7 and #8

  12. Agent’s Duties to the Principal • Fiduciary: put the interests of the principal ahead of your own • Loyalty: the agent may not secretly benefit from the transaction • Obedience: you must follow principal’s instructions • Reasonable Care and Skill: you must act with the care and skill of a reasonably prudent person

  13. Agent’s Duties to the Principal • Confidentiality: You must keep information private and deal with caution. • Accounting: You must account for all principal’s money and property that comes into your possession. No Commingling! (Mixing their funds with your funds)You must keep their money in a Trust Account.

  14. Agent’s Duties to 3rdParty • Do not act outside the scope of authority given you by the principal. • You must ensure that the principal has contractual capacity. Sometimes the principal wants to remain undisclosed- not have their identity known. In such cases the agent is liable on the contract.

  15. Principal’s Duty to the Agent • Pay what you promised for the agency’s services. • Reimburse the agent for any expenses incurred. • Cooperate with the agent after assigning him/her a task.

  16. Principal’s Duties to 3rd Party • To follow through on Agent’s agreement. • Not authorize or permit any improper acts. (Selling alcohol to a minor)

  17. How is an Agency Terminated • The principal may revoke the agent’s authority at any time. • Agent can quit at any time. (If under contract for a set amount of time and the agent quits, the principal may seek damages) • By Agreement: at the end of completion of a certain task, or after a certain length of time • By Operation of Law: upon death, insanity, bankruptcy, or change in law

  18. When an Agency has been Terminated • The principal must notify 3rd parties • If the principal does not give individualized notice, may be liable for agreements • Notice can be given by publishing in newspaper

  19. Examples • “What’s Your Verdict” on page 394 • “What’s Your Verdict” on page 395 • “Think Critically About Evidence” on page 397# 6-9

  20. The End! • In groups of three, do the “Think Critically About Evidence” problems on page 399. Type up your answers. Be prepared to discuss with class. • Individually, do the vocabulary worksheet

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