BU231 Chapter Notes - Chapter 17: Independent Business, Consumer Protection, Franchising
Document Summary
Agency is a relationship in which one person known as an agent is authorized by another person for whom she acts known as principal to form contracts with third parties on the principal"s behalf. Without the power to contract a representative is not an an agent in a legal sense. An agent is a person acting for another person in contractual relations with third parties. Principal is the person whose behalf the agent acts. A contractual relationship between agent and principal happens when the agent is being paid by the principal. A dependent agent is an agent who acts exclusively or mostly for a single principal. Agency may be reacted by the terms of an employment contract in which an employer (as principal) delegates to an employee (as agent) the authority to make contracts. An independent agent is an agent who carries on an independent business and acts for a number of principals.
