What is meant by actual and apparent (or ostensible) authority?
What are liabilities of agents who act without authority?
What remedies exist for a principal and/or third party where an agent has acted without authority?
Answers
Answer:
From the above passage, it is clear that actual authority depends upon the agreement between the principal and the agent, whereas apparent authority depends upon the representation made by the principal to the third party.
Answer:
- Actual Authority vs.
An agent will have apparent or ostensible (not actual) authority if the principal has indicated to a third party that an agent has the authority to act on their behalf, despite the fact that the agent doesn't have the actual authority to do so.
2. An agent that acts without authority or exceeding its authority is, failing ratification by the principal, liable for damages that will place the third party in the same position as if the agent had acted with authority and not exceeded its authority.
3. When the agent exceeds his authority : When an agent exceeds his authority or represents to have a kind of authority which he in fact does not have, he commits breach of warranty of authority and is personally liable to third party for any loss caused to him by reason of acting under the false representation.
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