(1) A. AGENCY
(a) Formation:
(1) Scope à general v. special
(2) Disclosure to T (by P) à disclosed v. undisclosed v. partially disclosed
(3) Right to Control A à employee/servant v. independent contractor
(b) Definition (§1.01) (to establish Agency (P liability for A actions to T):
MUTUAL ASSENT + BENEFIT + CONTROL
(c) Contract Liability(A binds P to liability by acting w/ “authority”:
(1) Authority (A power to bind P > A authority to bind P)à
(a) ACTUAL (P manifests consent to A; A power to bind P)
i. Express
ii. Implied (custom OR incidental acts)
(b) APPARENT (P manifests consent to T OR has notice)
i. Express (P tells T)
ii. Implied (context; custom; employment)
a. Estoppel (no manifestation; P knowledge + T reliance)
b. Inherent
1. Undisclosed P (custom + for P benefit) (manager)
2. Disclosed P (custom + for P + T reasonable belief)
(d) Tort Liability (respondeat superior if employee w/in scope of duty):
(1) Agency Relationship b/t P and A? (assent/benefit/control)
(2) Control: A servant/Employee OR independent contractor? (must be servant)
a. Employee Agent à P controls A (P liable if A w/in scope of job)
b. Independent Contractor à P has less control over A
i. agent: P limited control; A acts for P (liability rare)
ii. nonagent: P less control; A doesn’t act for P (no liability)
(3) Scope: if servant, act w/in scope of employment?
(B.) FIDUCIARY DUTY (A must advance P purpose)
(a) Duty of Care (§8.08)
(a) Standard Care (good faith/reasonable/informed)
(b) Standard Skill (based on occupation and locale)
(c) Special Skill
(d) Corollary Duties (scope; by instruction; reasonable; give info.)
(b) Duty of Loyalty (§8.01,3,6) (selfless (for P) AND protective (of P);
(a) Compensation (consent; no kickbacks; no compete; confidentiality)
(b) Adverse (A can act for/as adverse to P w/consent, GF, disclosure)
(c) Competition (A may prepare to compete; confidentiality);
(d) Recovery (P entitl
= no duty / corp. opportunity = duty)
ii. self-dealing (partner can’t be on both sides of trans.)
iii. competition (duty not to compete before dissolution)
(b) CARE
i. simple negligence (partnership not liable)
ii. gross negligence/reckless/intent/knowledge (pship liable)
(c) CONTRACT / DEFAULT RULES (b/tw partners)
i. Loyalty (partners can k for acceptable activities (reasonable)
ii. Care (partners may not unreasonably reduce pship by k)
iii. CAN’T contract out of fiduc. duty of loyalty (§103(b) (see i)
iv. CAN k for specifics (reduce fiduc. duty to encourage pships)
v. Default (disclose to partner; allow competition for corp. opp.)
vi. NO violation of duty for acting in own interest
