Business Associations

Agency is a fiduciary relationship arising from (1) the principal's manifestation that the agent act on the principal's behalf and subject to the principal's control, plus (2) the agent's consent. No consideration is required.

The principal must have contractual capacity, but the agent needs only minimal capacity and may even be one who lacks contractual capacity (e.g., a minor).

A general agent is authorized to conduct a series of transactions involving continuity of service; a special agent is authorized to conduct only a single transaction or a small group of transactions not involving continuity of service.

It is key to vicarious liability: a principal is generally liable under respondeat superior for the torts of an employee (servant) but not for those of an independent contractor, because the principal does not control the manner of the contractor's work.

A gratuitous agent serves without compensation. Such an agent still owes fiduciary duties to the principal, including the duty of loyalty, though the duty of care may be measured by the lower standard applicable to gratuitous service.

By agreement, by accomplishment of the purpose, by the principal's revocation, or by the agent's renunciation. Either party generally has the power (though not always the right) to terminate.