AGENCY
AGENCY is the fiduciary relation which results from the manifestation of consent by one person [the principal] to another [the agent] that the other [the agent] shall act on the principal’s behalf and subject to the principal’s control, and consent by the agent so to act.
Qui facit per allium facit per se – to the extent an agent has the power to bind; the agent’s conduct is attributed to the principal.
The legal concept of AGENCY applies regardless of whether the parties had the legal concept in mind and regardless of whether the parties contemplated the consequences of having the label apply.
Even if the parties expressly state that the relationship IS NOT an AGENCY relationship, the parties’ self-selected label is NOT dispositive and the circumstances of the relationship are still examined to determine if it is an agency.
ACTORS
MASTER
(1) Vicarious Liability – is broader than respondeat superior. Makes a principal liable for acts of an agent (K, and tort wrongs)
(2) Respondeat Superior – “let the master answer” – When a SERVANT commits a PHYSICAL TORT and causes PHYSICAL HARM, the MASTER is liable for SERVANT’s acts.
(3) Employment Law – independent Ks do not have to receive certain employment benefits.
Respndeat Superior
INDEPENDENT K
-Ends
SERVANT
-Means
-Employer-employee
AGENT (non-servant agent)
-K for Principal
-Brokers, lawyers, middlemen
NON-AGENT
-K with Principal
I. INADVERTENT AGENCY:
To form an agency relationship, 3 elements are required:
(1) Mutual consent of the parties (formal, informal, express, or implied),
(2) Agent acted on behalf of the principal, and
(3) principal controlled the agent
(1) MANIFESTATION OF CONSENT:
The creation of an agency relationship necessarily involves 2 steps:
To determine whether a would-be principal and would-be agent have consented, we look not to their inner, subjective thoughts, but rather to their outward manifestations
relationship.
(3) PRINCIPAL CONTROLLED THE AGENT:
To create an agency relationship, the agent MUST manifest consent to ACT FOR THE PRINCIPAL; that is, the agent MUST manifest recognition that serving the principal’s interests is the primary purpose of the relationship.
Ø Jensen Farms v. Cargill:
AGENT – Warren
PRINCIPAL – Cargill 3P – PL farmers
Issues – Does an agency relationship exist?
Farmers Warren Cargill
seed seed
Facts – Cargill is buying seed from Warren and loaning $$$ to Cargill to use as working capital. Cargill is a trade creditor. Warren defaults on amounts owed to farmers and farmers attempt to hold Cargill liable for Warren’s debts by establishing an agency relationship. Cargill dictated much of the
