Which of These is Not a Type of Agent Authority?
In business law, agent authority refers to the power or ability of an individual (the agent) to act on behalf of another person or organization (the principal). Agent authority can be granted in a variety of ways, and there are four main types of agent authority:
- Express authority is explicitly granted by the principal. This can be done in writing, orally, or through conduct. For example, a principal may give an agent a written power of attorney that grants the agent the authority to sign contracts on the principal’s behalf.
- Implied authority is inferred from the circumstances or the nature of the agent’s role. For example, a salesperson who is hired to sell cars is impliedly authorized to negotiate prices and terms of sale.
- Apparent authority arises when the principal gives the impression that the agent has authority, even if it was not explicitly granted. For example, if a principal allows an employee to consistently act as their representative and make decisions on their behalf, a third party may reasonably believe that the employee has the authority to do so.
- Incidental authority is the authority to do anything that is necessary or incidental to the performance of the agent’s express or implied authority. For example, a salesperson who is authorized to sell cars is also impliedly authorized to accept payments for those cars.
So, which of these is not a type of agent authority?
The correct answer is "obvious authority." Obvious authority is not a recognized type of agent authority in business law.
The other three options are all valid types of agent authority. Express authority is explicitly granted by the principal. Implied authority is inferred from the circumstances or the nature of the agent’s role. Apparent authority arises when the principal gives the impression that the agent has authority, even if it was not explicitly granted.
Additional questions related to "Which of These is Not a Type of Agent Authority?"
- What is the difference between express authority and implied authority?
The main difference between express authority and implied authority is that express authority is explicitly granted by the principal, while implied authority is inferred from the circumstances or the nature of the agent’s role.
For example, a principal may give an agent a written power of attorney that grants the agent the authority to sign contracts on the principal’s behalf. This is express authority.
On the other hand, a salesperson who is hired to sell cars is impliedly authorized to negotiate prices and terms of sale. This is because it is reasonable to assume that a salesperson would need to have this authority in order to perform their job duties.
- What is the difference between apparent authority and express authority?
The main difference between apparent authority and express authority is that apparent authority arises from the principal’s actions, while express authority arises from the principal’s words.
For example, if a principal allows an employee to consistently act as their representative and make decisions on their behalf, a third party may reasonably believe that the employee has the authority to do so. This is apparent authority.
On the other hand, if a principal explicitly grants an employee the authority to sign contracts on the principal’s behalf, this is express authority.
- What is the difference between incidental authority and express authority?
The main difference between incidental authority and express authority is that incidental authority is implied, while express authority is explicit.
Incidental authority is the authority to do anything that is necessary or incidental to the performance of the agent’s express or implied authority. For example, a salesperson who is authorized to sell cars is also impliedly authorized to accept payments for those cars. This is incidental authority.
On the other hand, if a principal explicitly grants an agent the authority to sell cars, this is express authority.
