Buisness orgs

relationship Any person who has the capacity to contract can appoint an agent to act on their behalf

: party who employs another person to act on his/her behalf; principal is liable

party who agrees to act on behalf of another; can contract with 3rd party

principal hires employee who in turn has authority to act and enter into K on principals behalf; goverened by express agreement

• Employer hires an employee to perform some form of physical service; employee isnt empowered to enter K unless specified

-determines whether someone is an independent contractor or an employee (control of when and where job will be done)

independent contractor

agent has power to K or otherwise act on principals behalf, written or oral (unless in SOF)

pricpal cannot employ an agent other than the exlusive agent

implied based on conduct of parties determined from facts and circumstances

person misrepresents themselves as an agent when they are not; ratifies unauthorized act

prinicpal creates false appearnce of an agency & agent was able to act on behalf; BINDING

agency that cannot be terminated, even by death, until complete EX. mortgage

TRUE

self dealing, usupring oppurtunities, competeing with the pricipal, misuse of confidential information, dual agency

true

principal is assuemd to know what the agent knows

agent has duty to maintain accurat accoutning transaction records

notification required for liablity protection; mutual agreement, time elapsed, pupose achieved, or occurence of stated event

death or insanity of agent or principal, bankruptcy of principal, war

change in law, destruction of subject matter, fulfillment impossible

violation of terms of K, non breaching party may recover damages, revocation/renunciation of authority

third partie knows who principal is and that they have hired that agent; agent not liable

third party knows agent is hired by principal but doesnt know prinicpals identity; agent/principal liable

thrid party doesnt know agent is an agent; principal/agent liable

principal isnt liable for agent exceeding scope

sole proprietor, simplest most common form;

easy, cost, right to all decesions and profits, easily sold and transfered

limited access to capital, loan msut be in personal name, legally responisble for buisness contracts-personal assets

no fed/state govt approval needed, buisness licesnce = DBA

creditors can recover claims from personal and buisness assets

voluntary assocaition of 2 of more people carrying on a buisness as coowners for profit

written document is ideal, but not requires. oral written implied or creadeted inadverntently

yes

true

fiduciary relationship imposed by law

duty of loyalty, duty of care, duty to inform, duty of obediance

general partners have joint and several liability

when only 1 partner is left, winding up

liquidation of partnersip asssets and distribution of the proceeds to satisfy claims aganist the partnership

disfavored by law, almost no benefit; invest captial but do not particpate in management and not personally liable for partnship debts