Formation (Agency)

Agency is a fiduciary relationship created by one person's consent for another to act in their interest and under their control. The principal requires contractual capacity, but not the agent. Agency law doesn't necessitate a written agreement, but may be subjected to the statute of frauds.

Actual Express Authority

Actual express authority is the authority explicitly granted within the four corners of the agency agreement, be it written or oral, and can also include any authority specifically granted through an appropriate decision-making process of the organization.

Actual Implied Authority

Implied authority is authority that the agent reasonably believes she has as a result of the actions of the principal. Absent an agreement to the contrary, all partners have equal rights in the management of the partnership business. Actual implied authority can be necessarily incidental to express authority or implied from acquiescence.

Termination of Actual Authority (Agency)

Actual authority will be terminated under the following circumstances:

1. After specified time or event or after reasonable time,
2. By change of circumstances,
3. By a breach of agent’s fiduciary duties,
4. By a unilateral act of either the principal or the agent, or
5. By the death or incapacity of the principal or agent.

Apparent Authority

Apparent authority arises when the partnership portrays a partner as having certain authority, leading others to reasonably believe that the authority exists. The third party must reasonably rely on this portrayal by the partnership. Under RUPA, actions by any partner that seem to be in the ordinary course of business bind the partnership unless the partner lacks the authority for that particular action, and the third party knew or was notified of this lack of authority. The principal's manifestations to a third party create apparent authority, not the mere representations of an agent.