Asked by Janell Cooper on May 14, 2024
Verified
________ is the right of a principal to sue an agent to recover any amount assessed against the principal for a breach of contract caused by the agent's negligence.
A) Rescission
B) Indemnification
C) Revocation
D) Contribution
E) Recoupment
Indemnification
Indemnification is the process by which one party agrees to compensate another for any losses or damages suffered, often as part of a contractual agreement.
Breach of Contract
The failure to perform any term of a contract, written or oral, without a legitimate legal excuse.
Agent's Negligence
A situation where an agent fails to perform duties with the required level of care or competence, resulting in harm or damage.
- Scrutinize the underlying concepts of liability, involving tort and contract responsibilities, in the scope of agency interactions.
Verified Answer
DM
Diara Md JadiMay 18, 2024
Final Answer :
B
Explanation :
Agents enter into contracts with third parties on behalf of a principal.If a third party believes that the agent is acting with actual or apparent authority,he or she may sue the principal for any breach of contract.However,when the breach was caused by the agent's negligence,the principal has a right to indemnification.That is,when sued by a third party,a principal may sue his or her agent to recover the amount assessed to the third party if the breach of contract is the agent's fault.
Learning Objectives
- Scrutinize the underlying concepts of liability, involving tort and contract responsibilities, in the scope of agency interactions.