For Your Data Watteau V. Fenwick Representative Brief

Watteau v. Fenwick illustration brief summary

FACTS

Humble, prior owner, operated Fenwick’s tavern nether Humble’s cite as well as credit as well as purchased foods from Watteau without Fenwick’s limited authority.  Fenwick prohibited Humble from buying goods for the tavern, except bottled ales as well as mineral water; Watteau was to furnish all other goods.  Humble violated Fenwick’s prohibition past times buying cigars as well as Bovril from Watteau.  When Humble was inwards absentia, Watteau sued Fenwick for the damage of the cigars as well as Bovril.

Actual Authority – None because Fenwick (principal) gave Humble (agent) specific instructions non to purchase anything except bottled ales as well as mineral water.

Apparent Authority – None because at that spot was no asset out past times the primary (Fenwick).  Watteau did non know that Fenwick existed.

Inherent Authority – Humble had apparent authority.  Fenwick is liable.

Inherent Agency Power – “Inherent agency power is a term used inwards the restatement of this plain of report to dot the power of an agent which is derived non from authority, apparent authorization or estoppel, but alone from the agency relation as well as exists for the protection of persons harmed past times or dealing amongst a retainer or other agent.”  Rest. (2d) of Agency § 8A.

a.       Gap filler.

b.      Places the loss on the company that stands to create goodness from the way relationship.

RULEIf the agent commits an unauthorized action, as well as at that spot is no actual, implied, or apparent authority, primary nevertheless may locomote liable for the loss based on the notion of inherent authority.

Undisclosed Principal

A third political party is natural springtime despite non knowing well-nigh principal.  Focus is on whether an way relationship/authority existed betwixt primary as well as agent.  If so, 3rd political party is bound.

 Exception – The 3rd political party may non locomote natural springtime if agent made a misrepresentation.

“A full general agent for an undisclosed primary authorized to deport transactions subjects his primary to liability for acts done on his account, if green or necessary inwards such transactions, although forbidden past times the primary to create them.”  Rest. (2d) of Agency § 194.

“An undisclosed primary who entrusts an agent amongst the management of his describe of piece of job concern is plain of report to liability to 3rd persons amongst whom the agent enters into transactions green inwards such businesses as well as on the principal’s account, although opposite to the directions of the principal.”  Rest. (2d) of Agency § 195.

Narrower Rule inwards Third Restatement

§ 2.06 – Liability of Undisclosed Principal

“(1) An undisclosed primary is plain of report to liability to a 3rd political party who is justifiably induced to brand a detrimental alter inwards put past times an agent acting on the principal’s behalf as well as without actual authorization if the principal, having discover of the agent’s deport as well as that it mightiness get others to alter their positions, did non accept reasonable steps to notify them of the facts.”  (emphasis added)

 “(2) An undisclosed primary may non rely on instructions given an agent that qualify or cut the agent’s authorization to less than the authorization a 3rd political party would reasonably believe the agent to receive got nether the same circumstances if the primary had been disclosed.”

b.      More akin to estoppel than quondam inherent way power.

Apparent Authority v. Inherent Authority

(Partially) disclosed principal à requisite manifestation past times primary creates apparent authority.

 Undisclosed principal à no communication or manifestation of authorization betwixt primary as well as 3rd political party à inherent authority.

Policy Rationale – Undisclosed primary is cheapest damage avoider/in best put to avoid loss.  Cheaper for undisclosed principals to accept precautions than to need all innocent 3rd parties to create so.

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