Saturday, March 31, 2012

Presumptions arising from the admission of agency

Few Missouri cases has discussed the numerous presumptions that arise, once an agency relationship of any kind is admitted. Agency is not presumed, but once agency is admitted, authority is presumed. Counsel ought to consider all of the following propositions, which should naturally flow from the admission of agency:

Regularity


From the presumption of regularity,  a presumption should arise that an admitted agent is acting within the scope and course of their authority.

The presumption of regularity has two branches. First, general or continuing agents are

Knowledge


Principals are presumed to know what their agents know.  



John D. Lawson, The Law of Presumptive Evidence 23 (2d. ed. St. Louis 1899) (available at Google Books)



Principals have a duty to monitor the actions of their agents. Principals are thus imputed with knowledge



Restatement Second


Discussion of the Restatement (Second) Agency §  49, comment c:

Inferences from agent's position. Acts are interpreted in the light of ordinary human experience. If a principal puts an agent into, or knowingly permits him to occupy, a position in which according to the ordinary habits of persons in the locality, trade or profession, it is usual for such an agent to have a particular kind of authority, anyone dealing with him is justified in inferring that he has such authority, in the absence of reason to know otherwise.
Rosenblum v. Jacks or Better of America West Inc., 745 S.W.2d 754, 764 (Mo.App. E.D.1988).

Specific application of the rule


Missouri has a long history of talking about the presumption of authority of an attorney.
Rosenblum v. Jacks or Better of America West Inc., 745 S.W.2d 754, 764 (Mo.App. E.D.1988).


Principal's are not presumed to intend that the main authority shall fail, due to a lack of authority as to acts reasonably necessary to make authority necessary

Craig v. Kansas City Terminal Ry. Co., 271 Mo. 516, 197 S.W. 141, 143 (Mo., 1917)

"It is a fundamental principle in the law of agency that every delegation of authority, whether `general' or `special,' carries with it, unless the contrary be expressed, implied authority to do all of those acts, naturally and ordinarily done in such cases, which are reasonably necessary and proper to be done in this case in order to carry into effect the main authority conferred. This doctrine rests upon the presumed intention of the principal that the main authority shall not fail because of the lack of express authority to do the incidental acts reasonably necessary to make that authority effective, and also upon the presumption that the principal expects the business to be done in the usual and ordinary way."

Principals are presumed to intend that their agents follow the practices, customs, and usages of the business or trade.


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