Solution manual

Part 6 Agency, EmploymenT, and Labor Law

ANSWER KEY

Chapter 22 Agency Law

Opening Case Questions

1. According to the text: “Agency is a legal relationship in which one party, the agent, transacts

business for and under the control of the second, the principal. The third party is that individual with

2. Vicarious liability is a legal doctrine that determines when a master (generally referred to in

5. The First Amemdment might be involved whenever the employer is a religious institution and the

employee is a religious employyee and the actions complained of have a connection to the employee’s

A QUESTION OF ETHICS

Clergy Malpractice, the First Amendment, and Charitable Immunity

Special Directions to the Instructor: Instructors are often baffled by the diverse and sometimes

contradictory responses that learners invent to answer this ethical question, particularly since the

Questions for Review and Discussion

1. Agency is a legal relationship between two persons. In an agency relationship one person is the

agent of the other. The agent is empowered to act for and under the control of the principal. The agent’s

job is generally to negotiate and make contracts for the principal with a third party. An agency

2. Vicarious liability is the legal theory that is used to hold the master liable for the torts of his or her

3. The different types of principals include disclosed, undisclosed, and partially disclosed principals.

identity of the principal. In the case of a partially disclosed principal, the third party knows that the

4. The different types of agents include general agents and special agents. A general agent is a

person who is given broad authority to conduct business on behalf of the principal. A special agent is a

5. There are two kinds of actual agency authority: express actual agency authority and implied

actual agency authority. Express authority is the authority that the principal voluntarily and specifically

sets forth as oral and written instructions to the agent. Implied authority is the agent’s authority to

8. An agency relationship can be terminated by an act of the parties (fulfillment of the purpose

9. Actual notice is required when the third party has extended credit to the principal through

10. The Uniform Computer Information Transactions Act (UCITA) establishes a cyber-agent as a

computer program that acts without human intervention to begin an activity, to answer cyber-messages,

to deliver or accept e-mail, or to enter cyber-contracts, as a representative of an individual who does not

1. Yes. The court found that the three level test for sovereignty had been followed properly. The

school district had first established that it had sovereign immunity under the state statute. The parents

3. Yes on both counts. The power to grant contracts to employees can be implied from the

president’s power to preside over the union’s administrative matters. Also, the past acceptance by the

4. The New Jersey Court found that the record revealed evidence of active wrongdoing on the part

of Mularchuk in the wounding of McAndrew. It concluded that the Borough of Keansburg was

responsible for that shooting, having authorized Mularchuk when on duty to carry a revolver without

6. No. The actions of the prison guard in striking the inmate were within the scope of his

8. Decision for LaPage. The court relied upon the doctrine of apparent authority involving the

9. The judgment was for Fortune Furniture. The court held the sending of the memo was chargeable

10. As an agent, Lloyd had the duty to keep a separate account of each principal’s funds. Whatever

money Lloyd received during and as a result of the principal relationships could have been held in trust

11. The judgment was for Clifton. The court held that Clifton had been authorized to act for Ross as

END CHAPTER TWENTY-TWO