Definitions.—An agent is a person authorized to act for another in dealing with third parties. The one for whom the agent acts is called the principal.

Authority of Agent.—An agent's authority may be granted orally or in writing. When written it is called a "power of attorney." A general agent has all the authority implied in his employment. A special agent has only such authority as is specifically granted.

Responsibility of the Principal.—Between the principal and his agent responsibility is determined by their contract. Expressly or impliedly the principal agrees to pay for the service rendered.

It is in the principal's relation to third parties that the most important rule of agency appears. It is this: The principal is responsible for the authorized acts of his agent. The theory is that the acts are those of the principal, the agent being merely an instrument. And accordingly, the principal is bound not only by such acts of his agent as he has really authorized, but also by such as he apparently authorizes.

Responsibility of Agent.—The agent is responsible to his principal for any violation of their contract. Expressly or impliedly he is bound to obey orders, to exercise ordinary skill and care in the performance of his duty, and to refrain from putting his interests in adverse relation to those of his principal.

To the third party the agent is not responsible, except in the following cases: When he specifically assumes responsibility, when he conceals the identity of his principal, when he exceeds his authority, or when he acts fraudulently.

Termination of Agency.—An agency terminates at the death of either principal or agent. It may also be terminated by revocation of authority, which takes effect upon receipt of the notice, or by the bankruptcy or lunacy of the principal, judicially declared.

Pertinent Questions.

In the following cases name the principal, the agent, and the third party: A clerk in a store; a man employed to sell goods by sample; a cashier in a bank; a conductor on a train; a commission merchant; a partner acting for a firm, a sheriff.

May a minor act as principal? As agent? A watch left at a jeweler's store for repairs is injured by the workman; who is responsible to the owner? On account of a road overseer's neglect a horse is injured by stepping through a hole in a bridge; to whom shall the owner look for damages? If a person is notified that another claims to represent him as agent and he neglects to repudiate the claim, is he responsible for acts of the claimant as agent?

May an agent having authority to fix prices sell to himself?

May a clerk in a store take goods at regular marked prices?

An agent transacts business after his principal's death but before he has received notice thereof, is the transaction binding upon the heirs?