Agency Law and its Significance
If you run a successful paper mill and send out your three best personnel to secure new wood
pulp sources using due diligence and skill. Applying the agency principles outlined in this
chapter, answer the following questions.
Delilah, does not return with wood pulp, but brings back three contracts. Acting within the scope
of her authority, she contracted with Evon, who knew your identity at the time; Felipe, who
knew that Delilah was acting on behalf of someone but not whom; and Giorgio, who did not
know that Delilah was acting on anyone’s behalf. For which contracts, if any, are you liable?
For which contracts, if any, is Delilah liable? Explain. a third person has no knowledge about
the fact that the agent is acting for a principal, then both the agency and the principal is known
as undisclosed ones. The agent of an undisclosed principal can be held liable, on the contract as
the real obligor as she contracted in that capacity. Similarly, an undisclosed principal can also be
held liable, so he must also assume its burdens. The liability of an undisclosed principal and the
agent is an alternative liability. It means that the third party can only make either the principal or
the agent liable and not both of them together. The contract with Giorgio is an undisclosed one
can you and Delilah are both liable. The situation is the same with Felipe although the agency
was known. He can hold either the agent or the principal liable for the contract. However, Evon
knew that Delilah was your agent and that you were the principal. Therefore’ you are liable but
Delilah is not.