The Agent May Be Subject to Liability to Her Principal

question 8

Multiple Choice

The agent may be subject to liability to her principal for breach of the duty of obedience if she:

• A) entered into an authorized contract and the principal has changed her mind.
• B) delegates her authority in any way and under any circumstances.
• C) committed a tort for which the principal is now liable.
• D) All of these.

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Definitions:

Negligent Misrepresentation

A false statement of material fact made by a person who thinks it is true but who would have known the truth about the fact had he or she used reasonable care to discover or reveal it.

Reasonable Care

The degree of caution and concern an ordinarily prudent and rational person would use in similar circumstances, typically used in legal contexts.

Voidable Contract

An agreement that may be annulled or declared void by one of the parties due to certain legal deficiencies or circumstances.

Rescinded

The act of revoking, canceling, or repealing a contract, decision, or agreement, making it as if it never existed.