Which of the Following Exemplifies the Liability of an Agent

question 28

Multiple Choice

Which of the following exemplifies the liability of an agent who acts without authority and contracts with a third party?

• A) The agent is liable to the principal for breach of warranty of authority.
• B) The third party is liable to the principal for breach of warranty of authority.
• C) The principal is liable to the agent for breach of agency by ratification.
• D) The agent is liable to the third party for breach of warranty of authority.

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Definitions:

Department

A distinct area, division, or branch within an organization or institution, specializing in a specific field of activity.

Loan Manager

An individual responsible for overseeing and directing the loan process within a financial institution.

Effective Apology

An apology that acknowledges wrongdoing, conveys remorse, offers a clear statement of regret, and, where possible, makes amends.

Approval Process

A structured sequence of steps or actions required to validate and authorize a proposal or action.