Question 1

Even after there is an effective ratification, the original action of an agent still is treated as unauthorized.

Accepted Answer

A) True 
 B)False

Question 2

__________ liable on contracts with third persons.

Accepted Answer

A)  Agents may intentionally make themselves
B)  Agents are never able to make themselves
C)  Agents are always
D)  None of the above statements are true.E) A) and B)
F) B) and C)

Question 3

A principal is not bound by statements made by an agent during the transaction of business that is within the scope of the agent's authority.

Accepted Answer

A) True 
 B)False

Question 4

If the principal is not disclosed, the agent is necessarily the other contracting party and is bound to the contract.

Accepted Answer

A) True 
 B)False

Question 5

The concept of imposing liability for the fault of another is known as __________ liability.

Accepted Answer

A)  imperious
B)  gregarious
C)  vicarious
D)  virtualE) A) and D)
F) A) and C)

Question 6

If an agent commits a crime, the agent's liability will depend on the agency relationship.

Accepted Answer

A) True 
 B)False

Question 7

Vicarious liability will not be imposed on a principal unless the agent was acting within the scope of the agent's authority.

Accepted Answer

A) True 
 B)False

Question 8

If an agent's act causes loss to the third person, that third person may generally hold the agent liable for the loss.

Accepted Answer

A) True 
 B)False

Question 9

Payment to an authorized agent is:

Accepted Answer

A)  payment to the principal only if the agent remits the payment.
B)  payment to the principal if the third person informs the principal.
C)  payment to the principal, provided the agent does not misappropriate the payment.
D)  payment to the principal.E) None of the above
F) A) and B)

Question 10

The same rules of law govern the vicarious liability of principals and employers.

Accepted Answer

A) True 
 B)False

Question 11

An agent who commits a tort and a crime is:

Accepted Answer

A)  generally liable for the crime but not the tort.
B)  generally liable for the crime but not the tort, assuming that the tort was committed to advance the interests of the principal.
C)  liable for both the tort and the crime.
D)  not liable for the tort or the crime, assuming both were committed to advance the interests of the principal.E) B) and C)
F) All of the above

Question 12

The principal is bound by knowledge but not by notice of any fact that is acquired by an agent while acting within the scope of actual or apparent authority.

Accepted Answer

A) True 
 B)False

Question 13

The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract.

Accepted Answer

A) True 
 B)False  True

Question 14

Apparent authority has the same effect as:

Accepted Answer

A)  undisclosed authority.
B)  actual authority.
C)  partially disclosed authority.
D)  none of the above.E) None of the above
F) A) and C)

Question 15

Tom Creighton hired Destroy, Inc., a demolition company, to level an old building on a busy downtown lot. Destroy, Inc. was given full rein to decide on the amount of explosives needed and the placement of the charges. Security for the site on the day of the explosion was contracted out to a private security firm. When the appointed day arrived, the building was brought down. However, the building fell in a slightly different direction than that anticipated by Destroy, Inc. Numerous pieces of adjoining property, both real and personal, were severely damaged. Creighton claims that the use of an independent contractor such as Destroy, Inc. has insulated him from liability. How do you respond to Creighton's claim?

Accepted Answer

It generally is true that a person hiring an independent contractor is not liable for any harm caused by the independent contractor or the independent contractor's employees. Exceptions to this general rule do exist. An exception exists for situations in which the work undertaken by the independent contractor is inherently dangerous. Demolition work accomplished through the use of explosives is just such inherently dangerous work. Creighton cannot hope to shield himself from his duty to protect the public from harm by delegating a dangerous task to another.

Question 16

Which of the following is a defense to an action against an agent for breach of the implied warranty of authority?

Accepted Answer

A)  The agent acted in good faith.
B)  The agent misunderstood the scope of authority.
C)  The third person knew that the agent was acting beyond the authority given by the principal.
D)  All of the above are correct.E) A) and B)
F) B) and C)

Question 17

Subject to certain limitations, a third person, on learning of the existence of an undisclosed principal, may sue the principal.

Accepted Answer

A) True 
 B)False

Question 18

If a contract is ambiguous regarding whether the agent has signed in a representative or an individual capacity:

Accepted Answer

A)  there is a presumption that the agent signed in a representative capacity.
B)  there is a presumption that the agent signed in an individual capacity.
C)  the agent and the principal will both be liable on the contract.
D)  parol evidence is admissible to establish the character in which the agent was acting.E) B) and D)
F) A) and B)

Question 19

A partially disclosed principal is:

Accepted Answer

A)  liable for a simple contract made by an authorized agent.
B)  not liable for a simple contract made by an authorized agent.
C)  solely liable on a simple contract made by an authorized agent.
D)  shielded from any liability, as an authorized agent is solely liable for any simple contracts made on behalf of the partially disclosed principal..E) None of the above
F) A) and C)

Question 20

If an agent makes a properly authorized contract with a third person on behalf of a disclosed principal, the agent has no personal liability on the contract.

Accepted Answer

A) True 
 B)False  True

Exam 38: Third Persons in Agency

Even after there is an effective ratification, the original action of an agent still is treated as unauthorized.

Correct Answer
verified

__________ liable on contracts with third persons.

Correct Answer
verified

A principal is not bound by statements made by an agent during the transaction of business that is within the scope of the agent's authority.

Correct Answer
verified

If the principal is not disclosed, the agent is necessarily the other contracting party and is bound to the contract.

Correct Answer
verified

The concept of imposing liability for the fault of another is known as __________ liability.

Correct Answer
verified

If an agent commits a crime, the agent's liability will depend on the agency relationship.

Correct Answer
verified

Vicarious liability will not be imposed on a principal unless the agent was acting within the scope of the agent's authority.

Correct Answer
verified

If an agent's act causes loss to the third person, that third person may generally hold the agent liable for the loss.

Correct Answer
verified

Payment to an authorized agent is:

Correct Answer
verified

The same rules of law govern the vicarious liability of principals and employers.

Correct Answer
verified

An agent who commits a tort and a crime is:

Correct Answer
verified

The principal is bound by knowledge but not by notice of any fact that is acquired by an agent while acting within the scope of actual or apparent authority.

Correct Answer
verified

The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract.

Correct Answer
verified
True

Apparent authority has the same effect as:

Correct Answer
verified

Which of the following is a defense to an action against an agent for breach of the implied warranty of authority?

Correct Answer
verified

Subject to certain limitations, a third person, on learning of the existence of an undisclosed principal, may sue the principal.

Correct Answer
verified

If a contract is ambiguous regarding whether the agent has signed in a representative or an individual capacity:

Correct Answer
verified

A partially disclosed principal is:

Correct Answer
verified

If an agent makes a properly authorized contract with a third person on behalf of a disclosed principal, the agent has no personal liability on the contract.

Correct Answer
verified
True

Exam 38: Third Persons in Agency

Even after there is an effective ratification, the original action of an agent still is treated as unauthorized.

Correct AnswerverifiedShow Answer

__________ liable on contracts with third persons.

Correct AnswerverifiedShow Answer

A principal is not bound by statements made by an agent during the transaction of business that is within the scope of the agent's authority.

Correct AnswerverifiedShow Answer

If the principal is not disclosed, the agent is necessarily the other contracting party and is bound to the contract.

Correct AnswerverifiedShow Answer

The concept of imposing liability for the fault of another is known as __________ liability.

Correct AnswerverifiedShow Answer

If an agent commits a crime, the agent's liability will depend on the agency relationship.

Correct AnswerverifiedShow Answer

Vicarious liability will not be imposed on a principal unless the agent was acting within the scope of the agent's authority.

Correct AnswerverifiedShow Answer

If an agent's act causes loss to the third person, that third person may generally hold the agent liable for the loss.

Correct AnswerverifiedShow Answer

Payment to an authorized agent is:

Correct AnswerverifiedShow Answer

The same rules of law govern the vicarious liability of principals and employers.

Correct AnswerverifiedShow Answer

An agent who commits a tort and a crime is:

Correct AnswerverifiedShow Answer

The principal is bound by knowledge but not by notice of any fact that is acquired by an agent while acting within the scope of actual or apparent authority.

Correct AnswerverifiedShow Answer

The liability of an agent to a third person depends on the existence of authority and the manner of executing the contract.

Correct AnswerverifiedTrue

Apparent authority has the same effect as:

Correct AnswerverifiedShow Answer

Which of the following is a defense to an action against an agent for breach of the implied warranty of authority?

Correct AnswerverifiedShow Answer

Subject to certain limitations, a third person, on learning of the existence of an undisclosed principal, may sue the principal.

Correct AnswerverifiedShow Answer

If a contract is ambiguous regarding whether the agent has signed in a representative or an individual capacity:

Correct AnswerverifiedShow Answer

A partially disclosed principal is:

Correct AnswerverifiedShow Answer

If an agent makes a properly authorized contract with a third person on behalf of a disclosed principal, the agent has no personal liability on the contract.

Correct AnswerverifiedTrue

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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
True

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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True