Johnson & Wales University Week 8 Cosmic Inc Law Discussion I attached my assignment below.Please send it by Tomorrow(July 23) at 5 p.m. – Eastern Time Zon

Johnson & Wales University Week 8 Cosmic Inc Law Discussion I attached my assignment below.Please send it by Tomorrow(July 23) at 5 p.m. – Eastern Time Zone Requirement
*The assignment should be half page
Week 8 Discussion: Agency
Directions: You must first fully answer the question by creating a new thread, then respond
to at least two postings of others. Please note that you will not be able to see the responses of
other students in any discussion forum until after you have posted your own response.
Remember to support all legal assertions with appropriate citations to source materials.
Joshua, an employee of Cosmic, Inc., was drinking during his lunch break on Tuesday. When he
returned to work, his boss, Rebecca, noticed that Joshua had been drinking and sent him home for
the remainder of the day, without pay. Rebecca instructed Joshua to leave his car at work and take
an Uber or a Cab home. Rebecca also instructed Joshua that she would pick him up in the morning
on her way into work. Unfortunately, Joshua ignored Rebecca’s instructions and drove himself
home and on the way home, he caused an accident injuring a third party. Is Cosmic, Inc. liable for
the damages that resulted from its employee’s behavior. Why or why not?
Videos:
Agency Law (45:09): https://youtu.be/L_tsPzj27-0
Respondeat Superior (2:50): https://youtu.be/kh7lqqfOhaY
Week Eight
Chapter 17
Creating an Agency Relationship
•
Principals have substantial liability for actions of their agents
•
To create agency relationship, there must be
•
1.
2.
3.
4.
5.
A principal
An agent
Mutual consent that agent will act on behalf of principal
Agent subject to principal’s control
Thereby creating a fiduciary relationship
Elements that are not required
1.
2.
3.
Written agreement
Formal agreement
Consideration/Compensation
Duties of Agents to Principals
•
Duties owed to Principal
1. Duty of Loyalty – put principal first always
•
•
•
•
•
•
Outside Benefits – none unless principal knows and approves
Confidential Information – must always protect
Competition with Principal – never if it is within scope of agency business with principal
Conflict of Interest – cannot have 2 principals whose interests conflict
Secret Dealings – agent cannot become party to transaction unless Principal knows
Appropriate Behavior – never reflect badly on principal
2. Duty of Care – reasonableness standard
3. Duty to Obey Instructions – unless illegal or unethical
4. Duty to Provide Information – all info agent believes principal wants to
know
Principal’s remedies
1. Recover from agent any damages breach has caused
2. If agent breaches Duty of Loyalty, agent must turn over any profits earned
as result of breach
3. If agent breaches Duty of Loyalty, principal may rescind the transaction
Duties of Principal to Agent
•
Duties owed Agent
1. Pay agent for services
2. Reimburse agent for reasonable expenses
3. Cooperate with agent in performing agency tasks
Terminating Agency Relationship
•
3 ways to terminate relationship
1.
2.
3.
Termination by Agent or principal
•
•
•
•
•
Term Agreement
Time
Achieving Purpose
Mutual Agreement
Agency at Will
•
•
•
•
Fails to keep or obtain required license
Bankruptcy by either party if it affects ability to perform
Death or incapacity of either party
Agent violates duty of loyalty
Principal or agent can no longer perform duties
Change in circumstances
• Change in law
• Loss or Destruction of Subject Matter
Effect of termination
• Once relationship ends, agent no longer has authority to
act for principal
• Some duties remain after termination
1. Principal’s duty to indemnify
2. Agent’s duty to protect confidential
Liability Issues
•
Principal may be liable (even if agent disobeys
instructions) for
1. Contract agent signs
2. Torts agent commits
•
Agent may be liable to 3rd parties if oversteps bounds of
agency
Principal’s Liability for Contracts
•
Generally, cannot rescind contracts entered into by agent
•
Principal bound by acts of agent if
1. Agent had authority OR
2. Principal is estopped from denying agent had authority (fairness) OR
3. Principal ratifies acts of agents (accepts benefit of unauthorized transaction
or fails to repudiate it)
3 types of authority
1. Express – by words or conduct that, reasonably
interpreted, cause agent to believe has authority to act
2. Implied – for acts reasonably necessary to accomplish
transaction
3. Apparent – Principal’s conduct causes 3rd party reasonably
to believe agent is authorized to act
4 steps to ratification
1. Agent indicates to 3rd party that he/she is acting for
principal
2. Principal knows all material facts for transaction
3. Principal accepts benefit of whole transaction, not just part
4. 3rd party does not withdraw from contract before
ratification
Agent’s Liability for Contracts
•
Agent liability depends on what 3rd party knew about the principal
(disclosure is agent’s best protection)
•
3 types of principals
•
1. Fully Disclosed – agent not liable
2. Unidentified – agent and principal liable
3. Undisclosed – agent and principal liable
Unauthorized Agent – principal not liable but agent is liable
Principal’s Liability for Torts
•
Master liable for physical harm caused by negligent conduct of
servants within scope of employment (Respondeat Superior)

•
Liable even if forbade or tried to prevent act
•
2 types of agents
1. Employees – Principal may be liable
2. Independent Contractors – Principal most likely NOT liable
Independent Contractors
•
Factors court will consider (non are determinative themselves)
1. Principal supervises details of work
2. Principal supplies tools and place of work
3. Agents work full time for principal
4. Agents receive salary or hourly wages, not fixed price for the job
5. Work is pat of regular business of principal
6. Principal and agents believe they have employer-employee relationship
7. Principal is a business
Scope of Employment
•
Only liable for torts employee commits within scope of employment (doing job)
•
Employee acting within scope if act
1.
2.
3.
4.
5.
6.
Is one that servants generally responsible for
Takes place during hours that servant is employed
Is part of principal’s business
Is similar to one the principal authorized
Is one for which principal supplied tools AND
Is not seriously criminal
•
Authorization – same or incidental to that which was authorized
•
Abandonment (frolic) – ex – Boss sends you to Staples to get copy paper. On the way,
you stop by Harris Teeter to pick up bread for home. Stop at Harris Teeter is a frolic
Negligent and Intentional Torts
•
Master generally liable if employee commits negligent tort that
causes physical harm to person or property
•
Master generally not liable for intentional torts unless
1. Employee motivated by desire to serve master OR
2. Conduct was reasonably foreseeable
Agent’s Liability for Torts
• Agents always liable for own actions
• Liable whether or not principal is liable
• Jointly and Severally liable – Plaintiff can sue Principal, Agent
or both

Purchase answer to see full
attachment