Example Of Agency Law Problem Forum Essay

Principles of agency law apply to the contract formed between Benjamin and Steven and will ultimately hold Carl, the principal, liable for the contract concerning the retail space. Carl gave Benjamin, his employee, explicit and actual authority to enter into a purchase agreement for up to $2,000,000 for certain farmland with Steven. The fact that Steven was unaware that Benjamin was acting on Carl’s behalf does not matter. The case would be different if Benjamin lacked the authority from Carl to purchase farmland and Benjamin did so anyways, without Carl’s permission. But because Carl gave Benjamin the authority to purchase the farmland up to a specified price, and Benjamin did exactly as instructed, Carl will be responsible for the contract entered into for the farmland.
After Benjamin entered into the purchase agreement contract with Steven, he drove back and stopped at a Starbucks where he negligently injured a pedestrian with his car. The question is whether Carl, the employer, will be vicariously liable for Benjamin’s negligence. If Benjamin was an independent contractor, Carl would not be vicariously liable for any of Benjamin’s negligent conduct because Benjamin would not be under the direct supervision and control of Carl. But since Benjamin is an employee under the supervision and control of his employer, Carl, Carl can be held liable for Benjamin’s negligence. In order for Carl to be liable for his employee’s negligent conduct, Benjamin’s negligent act must have occurred within the scope of his employment. Although driving to meet Steve and executing the contract was definitely within the scope of Benjamin’s employment and any negligence that occurred in this time frame would definitely fall under the scope of employment, it is less clear whether Benjamin’s stop at Starbucks after the contract was still within the scope of his employment, or was a frolic. Because stopping at Starbucks occurred after the sale of the farmland and was on Benjamin’s own accord, it will most likely fall outside the scope of employment. Therefore, since Carl will not be vicariously liable for Benjamin’s negligence, Benjamin alone will be liable for the pedestrian’s injuries.