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Chapter 29
Agency Formation and Termination
VI. Answers to Critical Legal Thinking Cases
29.1 Scope of Employment
No. The court held that James Goldick, an employee of Lapp Roofing and Sheet Metal Company, Inc.,
was not acting within the scope of his employment when, after drinking at a bar, he injured several
persons while driving a vehicle that had been placed in his possession by Lapp Roofing. The court stated,
“There comes a point in every litigation where common sense will make some conclusions obvious.” The
court noted that obviously a crew who is assigned for several days or weeks to a remote location will need
to utilize the company vehicle to get meals or other necessities associated with that stay. The court stated,
“Therefore, if this event had occurred as the employees were leaving Happy Harry’s after they obtained a
needed prescription or from Denny’s Restaurant after a meal, the court believes these foreseeable and
29.2 Independent Contractor
29.3 Power of Attorney
Yes, King is liable to Bankerd for gifting the property to Mrs. Bankerd. A power of attorney creates a
principal-agent relationship. Broadly defined, a power of attorney is a written document by which one
of summary judgment in favor of Bankerd that awarded $13,555 in damages against King. King v.
Bankerd, 492 A.2d 608, 1985 Md. Lexis 589 (Court of Appeals of Maryland)
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29.4 Apparent Agency
bank about the possibility of financing the Bartonsville project, and the limit on Ziobro’s authority to
make loans was not communicated to Bolus. Thus, the bank clothed Ziobro with apparent authority to
commit the bank to financing Bolus’s project. The Appellate Court affirmed a jury verdict in favor of
Bolus. Bolus v. United Penn Bank, 525 A.2d 1215, 1987 Pa. Super. Lexis 7258 (Superior Court of
Pennsylvania)
29.5 Imputed Knowledge
court’s decision that permitted Iota to rescind the contract. Iota Management Corporation v. Boulevard
Investment Company, 731 S.W.2d 399, 1987 Mo. App. Lexis 4027 (Court of Appeals of Missouri)
VII. Answer to Ethics Case
29.6 Ethics Case
himself to damages by doing so. The court held that the Hagues had no legal ground for terminating their
agency agreement with Hilgendorf and were liable for wrongful termination of the agreement. Where the
principal terminates an exclusive agency listing within the term, the agent may show that he would, but
for the termination, have sold the property within the unexpired period at the listing price, and then he can
Iowa)