Formation and Termination of Agencies

Formation and Termination of Agencies

Introduction

Agencies are vital sections of the business world. Ideally, these agencies act on behalf of the principle. In a world of business where urbanization and technology are impacting on the company, there is a lot that a company has to tackle, which the principle cannot handle single-handedly. As such, many firms opt for employing agencies to run the operations of the company on their behalf. There are two types of agencies, the gratuitous and the compensated agencies. The gratuitous agencies tend to run the business without being paid, the compensated ones, on the other hand, are paid for the services they offer.  The relationship between the agent and the principle most of the time is sealed with a contract that sees fit to it that the agreed terms and conditions are followed to the latter.

Thesis:  Ideally, a thorough evaluation of the creation of the agencies to the point of termination can insightfully enhance our understanding of the relationship between the two.

Paragraph 1: Conditions for forming the agent-principle relationship

Similar to another contract, I will evaluate the legal requirements that are needed for the formation of an agency. Some of the factors I will address include the capacity in terms of experience and age.

Paragraph 2: Duties and responsibility of the agent and The Agent’s Liability on the Contract.

Understanding the responsibility that the principle expects will prevent future issues such as suits and even termination. I will outline what the employee, who is the principal expects from the agent. I will also discuss the authority that the agents have to respond to the acts of the principal he(the agent) sees not fit. Some of these authorities include disclosed principals and Undisclosed and Partially Disclosed Principals.

Paragraph 3: Duties and responsibilities of the principle and the types of authority that a principal can vest on the agency

The principle also has a responsibility towards his agents. Understanding these roles will be useful in promoting a friendly relationship between the two. I will also look into the Principal’s Liability for the Agent’s Contracts. I will address the various types, which are actual authority, apparent authority, and ratification.

Paragraph 4: Tort Liability and Agency

The principles are liable for the torts of their employees. The law evaluates the tort in terms of if it was committed within the work environment. Understanding the formation of such tort aids in avoiding such events and even understanding how it works.

Paragraph 5: Termination of the agency

Finally, I will address the legal procedures that are used in the process of terminating such contracts. I will also evaluate the conditions which favor the termination of these contracts.

Conclusion: Understanding agency relationships requires a thorough evaluation of the contract from its formation to the termination phase.

Summary of body paragraphs.

References

Clarkson, K. W., & Miller, R. L. (2020). Business Law: Text and cases. Cengage Learning.

King Kneeland, M., & Kleinbaum, A. M. (2020). On Agency and its Limits: The Asymmetric Effects of Offsites on Network Tie Formation. Available at SSRN.

Muhl, C. J. (2001). The employment-at-will doctrine: three major exceptions (Links to an external site.). Monthly Labor Review, 124(1), 3-11. Retrieved from http://www.bls.gov/opub/mlr/2001/01/art1full.pdf

Rogers, S. (2012). Essentials of Business Law [Electronic version]. Retrieved from https://content.ashford.edu/

Thompson, J. (2016). Termination of Contracts. Legal Magazine.