While an Agent Is Travelling in Northern Ontario, His Principal

question 52

Multiple Choice

While an agent is travelling in Northern Ontario, his principal dies. Before he is informed of this, but after the death, the agent signs a contract within his authority with a third party. Which of the following statements is true?

• A) The principal's estate must honour the contract.
• B) The agent becomes liable on the contract.
• C) The principal is in breach of the agency agreement.
• D) The agent is in breach of the agency agreement.
• E) The third party can sue the agent for breach of warranty of authority.

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Definitions:

Contracts

Contracts are legally binding agreements between two or more parties that outline duties, rights, and conditions agreed upon by the parties.

Verbal Agreements

contracts or commitments made through spoken words rather than written documents.

Written Agreements

Formalized contracts or documents that outline the terms, conditions, and obligations agreed upon by two or more parties.

Recruit Members

The process of actively seeking and enrolling new individuals into a group, organization, or team.