Exculpatory Clauses That Try to Relieve a Principal of Liability

question 40

True/False

Exculpatory clauses that try to relieve a principal of liability for an agent's misrepresentations usually insulate the principal from tort liability and prevent the third party from rescinding the contract.

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Definitions:

Gain

Gain refers to an increase in economic benefits or inflow of assets that result in an increase in equity, not related to contributions from equity participants.

Office Equipment

Assets like computers, desks, and chairs used in an office to carry out operations, not immediately consumed in the production process.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life.

Prepaid Expenses

Expenses paid in advance for goods or services to be received in the future.