Sunday, July 31, 2011

When there is actual authority, the absence of apparent authority is irrelevant

American Standard Credit v. National Cement Co., 643 F.2d 248, 267 (5th Cir.1981).

See also Taylor v Taylor, 20 Ill. 650, 652 (1858 (all acts of act performed within the scope of the agency bind the principal).

Actual authority may be:
  • express
  • implied from facts and circumstances
  • implied from knowing acquiescence in the agent's earlier actions or course of conduct
  • incidental
  • by operation of law
  • inherent

Wednesday, July 27, 2011

Imputed Knowledge: Sole Shareholder? Yes

FDIC v Ernst & Young, 967 F.2d 166, 171 (5th Cir. 1992)

There is substantial authority in support of the "sole actor" doctrine which imputes knowledge of the dishonest agent to the principal

Munroe v. Harriman, 85 F.2d 493, 111 A.L.R. 657 (2nd Cir. 1936)  certiorari denied Harriman Nat. Bank & Trust Co. v. Munroe, 299 U.S. 601, 57 S.Ct. 194, 81 L.Ed. 443.

Restatement (Second) Agency, Sec. 282, sub. c (1958)

Restatement (Third) Agency, Sec. 5.04, Ill. 10, Reporter's Notes (2005) (citing Munroe)

Missouri agrees:

Newco Land Co. v. Martin, 358 Mo. 99, 213 S.W.2d 504, 515 (1948).





Writings are meaningless, especially if self-serving

    Restatement (Third) Agency Sec. 1.02 (2005)
    E.g., Empson v. Mo. Hwy. & Trans. Comm., 649 S.W.2d 517, 521 [4][5][6] (Mo. App. 1983). 
    Empson states:
[4][5][6] It is important to note the mere characterization of one party (in a contract) as an independent contractor is not controlling on the question of agency where surrounding facts evince an agency relationship, however artfully disguised. Northern v. McGraw-Edison Co., 542 F.2d 1336, 1343 (8th Cir.1976)."
Accord In re Mid-America Living Trust Assoc. Inc., 927 S.W.2d 855, 866 (Mo. 1996) (describing such disclaimers and “self-serving”); and State ex rel Ford Motor Co. v. Dierker, 766 S.W.2d 691, 695 (Mo. 1989)

Ford Motor adopted Empson’s holding:

[T]he characterization of the relationship by the parties is not controlling “where surrounding facts evince an agency relationship, however artfully disguised.” Empson v. Missouri Highway & Trans. Comm'n, 649 S.W. 2d 517, 521 ( Mo.App. 1983).