Asked by Aqualaquisha Lebron on May 16, 2024
Verified
Discuss the fundamental rules of contractual liability between a principal and the third party.
Contractual Liability
The legal obligations that parties have under a contract, including the consequences of breach.
Principal
The main party to a transaction, acting on their own behalf, such as the owner of a business or the person for whom an agent acts.
Third Party
A third party is an individual or entity who is not directly involved in a legal agreement or dispute but may be affected by it or have rights or obligations related to it.
- Familiarize yourself with the structure of principal-agent relationships and the specific conditions that may result in liability for either the principal or the agent in contract situations.
- Understand the doctrines of ratification and adoption in the context of unauthorized contracts.
Verified Answer
FA
Fawzia AlmesriMay 18, 2024
Final Answer :
a. A disclosed principal and the third party are contractually bound if the agent acts within her actual or apparent authority in making the contract.
b. An unidentified (partially disclosed) principal and the third party are contractually bound if the agent acts within her actual or apparent authority in making the contract.
c. An undisclosed principal and the third party are contractually bound if the agent acts within her actual authority in making the contract unless
(a) the terms of the contract exclude the principal or;
(b) the principal's existence is fraudulently concealed.
d. No principal is contractually bound to a third party if the agent acts without any authority, unless a disclosed or unidentified (partially disclosed) principal ratifies the contract.
b. An unidentified (partially disclosed) principal and the third party are contractually bound if the agent acts within her actual or apparent authority in making the contract.
c. An undisclosed principal and the third party are contractually bound if the agent acts within her actual authority in making the contract unless
(a) the terms of the contract exclude the principal or;
(b) the principal's existence is fraudulently concealed.
d. No principal is contractually bound to a third party if the agent acts without any authority, unless a disclosed or unidentified (partially disclosed) principal ratifies the contract.
Learning Objectives
- Familiarize yourself with the structure of principal-agent relationships and the specific conditions that may result in liability for either the principal or the agent in contract situations.
- Understand the doctrines of ratification and adoption in the context of unauthorized contracts.