Saturday, March 31, 2012

More on hide and seek: act is necessary to accomplish the purpose of the employment and is intended for such purpose, although in excess of the powers actually conferred

In Sandman the court observed: 'It has been said an act is 'within the scope of the servant's employment' where such act is necessary to accomplish the purpose of the employment and is intended for such purpose, although in excess of the powers actually conferred on the servant by the master.' Sandman v. Hagan, supra at 117. See also, Seybold v. Eisle, 154 Iowa 128, 134 N.W. 578, 580-581 (1912); United States v. Farmer, 400 F.2d 107, 110-111 (8 Cir. 1968).

Missouri follows this view.
Implied authority flows from the express authority, and encompasses the power to act in ways reasonably necessary to accomplish the purpose for which express authority was granted.

What if the agency agreement or contract has a secret limitation on the agent's authority?
[A] contract will be treated as abandoned where the acts of one party inconsistent with its existence are acquiesced in by the other." Alropa Corp. v. Smith, 240 Mo. App. 376, 199 S.W.2d 866, 871 (1947); accord In re Estate of Reed, 414 S.W.2d 283 (Mo.1967).

In Ticor Title Ins. Co. v. Nat'l Abstract Agency, Inc., District Judge Cleland found that title insurers routinely abandon provisions  in their agency contracts that limit the authority of agents to conduct or handle closings, escrows, or settlements.

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